The Board of Directors of the IIF is committed to working with its members and other financial institutions, the official sector, and the Greek authorities, to deliver substantial cash-flow support to Greece, as well as to lay the basis for a more sustainable debt position.
As Greece advances in its reforms, it will be crucial for the official sector to continue providing funding for the Greek banks until the benefits of steady progress under the reform programme would allow them to regain access to market financing.
The involvement of private investors will complement parallel official financing and liquidity support, and will be based on a small number of options. These options will include a roll-over or extension of maturities and the re-investment of creditor claims into long-dated instruments with principal collateralisation. In addition, it would be important to consider possible debt buyback proposals, which could, along with further fiscal adjustment, begin to reduce the stock of debt and help pave the way towards improved debt sustainability.
The operational details of these options are already under discussion and will be advanced in the period ahead, with the objective of providing significant cash-flow support to Greece during 2012-14 on the basis of broad-based voluntary participation by private investors, subject to economic and legal reviews by individual institutions. In addition, debt-buyback techniques will be explored.
Press release
© IIF - Institute of International Finance
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