Greek Austerity Has Numerous Rinkles
The most widely discussed format for the agreement on Greek debt rollovers has been modeled after the discussions taken place with French banks. Under this plan, financial institutions would rollover 50% of the proceeds from bonds maturing between 2011 and 2013 into 30-year Greek bonds. The new bonds would have a coupon of around 5.5% plus a possible GDP warrant worth up to 2.5%. Bond holders would invest an additional 20% of the proceeds in a special purpose vehicle (SPV) holding newly issued Greek bonds. By doing so, they would hold equity in this SPV instead of outright Greek debt on their balance sheets.
Similar Posts:
- FOREX: Euro May Not Rise on Greek Accord, Pound Braces for More QE
- Euro: Looking for an Upside Breakout
- Forex: Euro Weakness To Accelerate On Increased Skepticism
- Markets Remain Resilient Despite Downgrades and Turbulence
- European Central Banks (BoE & ECB) Take Different Paths
