Private Greek bondholders are willing to accept 70% haircut

Date: Friday 27 Jan 2012

The Institute of International Finance (IIF), which represents private-sector holders of Greek bonds, has offered to accept a 70% haircut on its debt, according to remarks from Deutsche Bank chief executive officer (CEO) Josef Ackermann in an interview with German media outlet N-TV. Ackermann described the offer as “attractive” and insisted that everyone has to contribute.

The CEO did not comment on the coupon rates for the new Greek bonds in the debt swap. Negotiations were halted last week because the IIF offered a coupon rate of 4% while the European Union (EU), the International Monetary Fund (IMF) and the European Central Bank (ECB) held out for a rate closer to 3.5%. Some reports now say that they could agree on 3.75%.

Greece must reach an agreement with private bondholders if the country pretends to receive EU, IMF and ECB approval for a second bailout package of €130bn. The Aegean nation needs the funds in order to avoid a default.

For now, it has been confirmed that the “troika” (the group representing the EU, IMF and ECB) will not have its 'mission report' ready by Monday’s EU summit.

The “troika” will analyse Greece’s progress on reforms.

JM

« Go back to news channel

Email this article to a friend

or share it with one of these popular networks:

• DIGG
• FACEBOOK
• STUMBLEUPON
• MIXX
• YAHOO BUZZ
• DELICIOUS
• REDDIT
• NEWSVINE