Greece slows action on bond swap for governments to assess bonds

Athens, Greece (AHN) – Greek Finance Minister Evangelos Venizelos has called on his colleagues worldwide to help his government assess global holdings of Greek government bonds before the embattled country proceeds with a proposed bond-swap deal.

Venizelos sent a letter Friday to foreign finance ministers asking for help in compiling data on the amount of Greek government bonds held by banks in their countries. Greece won’t proceed with the bond swap if private participation falls short by 90 percent.

Under the deal, private holders of Greek bonds will be asked to exchange them for other bonds that pay less interest over a longer time frame. Investors holding 90 percent of all bonds are eligible to participate, including 90 percent of those maturing in June 30, 2011, and August 31, 2014.

In July, eurozone leaders agreed a new financial package for Greece worth $156 billion (109 billion euros), its second bailout by the European Union to cover the country’s financial needs.

Greece will be allowed a longer term to repay its debts but the government has to continue with a number of spending cuts to reduce its debts. The Greek economy’s debt totals 142.8 percent of the country’s annual economic output.

The European Union and International Monetary Fund agreed to bail out Greece for the first time in May 2010, with a rescue package amounting to $146 billion (110 billion euros).

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