Procedures formally opened on Thursday for the finalisation of the terms under which the private sector will take part in the cost of the second support package for the Greek economy.
A meeting was held in Athens between Greece's Debt Management Organisation, representatives of the International Institute for Finance (IIF) and senior officials of the Greek and foreign banks that will be taking part in the process, who discussed the practical implementation of last week's eurozone summit decisions on the 109 billion euros second support package, with respect to the private sector.
Under the eurozone decisions, the private sector will participate voluntarily in the package with approximately 50 billion euros via swaps of existing Greek state bonds maturing up to 2020 with bonds of a larger duration and mean value reduction of 21 percent. The swap process is expected to being in August, according to the Greek finance ministry.
According to IIF data, by the beginning of the current week approximately 45 percent of Greece's bank creditors had responded positively to the arrangement, while the target set out is for 90 percent.
On Wednesday, the Greek finance ministry appointed BNP-Paribas, Deutsche Bank and HSBC as the co-underwriters in the implementation of the PSI (private sector involvement in the voluntary bond swap scheme), an agreement to re-invest in Greek state bonds and a bond buyback program agreed at the eurozone summit. The finance ministry also appointed the Gottlieb Steen & Hamilton LLP law firm as the Greek state's international legal advisor and Lazard Freres as the financial advisor of the Greek state in the PSI procedure.