Debt crisis: Live
Royal Bank of Scotland and HSBC confirm they will participate in the €206bn Greek debt swap, joining a list of 30 banks holding 39.3pc of the bonds as markets steady ahead of ‘default’ deadline.
• 32 major banks to participate in Greek debt swap
• Germany and Greece openly discussed Greek euro exit
• Investors have until 8pm Thursday to participate in bond swap
• European stock markets pare losses on calmer day of trading
• Vince Cable: Britain lacks a coherent growth strategy
19.45 However, Mr Schaeuble added that even though it may have been wrong for Greece to join the euro, the country had “100pc decided” that they wanted to stay inside the 17-nation bloc, and it was “ridiculous” to think that other countries wanted to punish Greece.
But Greece has more work to do, he said, and the eurozone as a whole must work to solve the competitiveness gap.
On Ireland and Portugal, which also received bailout cash, Mr Schaeublesaid they “will succeed”.
Mr Schaeuble was speaking at a Q&A session after a speech in Fiesole, Italy. Earlier today, he met with Italian PM Mario Monti to discuss economic affairs.
19.25 German finance minister Wolfgang Schaeuble has admitted that he discussed openly with Greece’s finance minister Evangelos Venizeloswhether it would be better for the country to leave the euro.
19.04 More rumours on who’s in and who’s out of the Greek bond swap.
According to the state-run Athens News Agency (ANA), eight Greek pension funds, along with the social insurance mutual funds management company, have signed up, adding another €3.31bn to the “yes” pile, while six other pension funds did not accept the government’s invitation.
ANA said that these six funds own state bonds worth €3.4bn.
These bonds are separate from those managed by the Bank of Greece (see 12.15), said ANA. Reuters estimates that these bonds are worth about €19bn.
18.50 Respected economist Nouriel Roubini writes in the FT that Greece’s private creditors are the lucky ones in the country’s latest debt deal, and any suggestion that private bondholders have accepted significant losses in the restructuring of Greece’s debt; while the official sector gets off scot free is a “myth”:
The reality is that private creditors got a very sweet deal while most actual and future losses have been transferred to the official creditors.
Greece’s private creditors should stop complaining and accept the deal offered to them this week. They will take some losses, but those losses are limited and, on a mark-to-market basis, the debt exchange offers them a potential capital gain. Indeed, the fact that the new bonds are expected to be worth more than the old bonds suggests that this PSI exercise has further transferred losses to Greece’s official creditors.
The reality is that most of the gains in good times – and until the PSI – were privatised while most of the losses have been now socialised. Taxpayers of Greece’s official creditors, not private bondholders, will end up paying for most of the losses deriving from Greece’s past, current and future insolvency.
- Now Greece brings default instead of debt swap (donny-wise.com)
- Greek bond swap gains momentum as deadline nears (newsok.com)
- Germany’s Bild set to take a haircut on Greek bonds (guardian.co.uk)
- Greece tightens screws on creditors to accept haircut (rt.com)
- Greek bond swap sees more takers as deadline nears (newsok.com)