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15 May 2012

Bloomberg: Greece makes repayment on €435 million of bonds


Greece is to repay €435 million of bonds falling due today, as the nation faces new elections after leaders failed to form a government.

Greece will pay the principal and interest on foreign law notes which weren’t tendered into the country’s debt restructuring, the Athens-based Finance Ministry said. The repayment won’t prejudice future decisions on other untendered bonds, the ministry said.

Greece swapped about €200 billion of its sovereign debt in March and April in the world’s biggest debt restructuring, forcing holders of notes issued under domestic law to accept a 53.5 per cent loss on the face value of the bonds. The May 15 redemption is the first out of about €6.4 billion of notes issued under foreign law that investors refused to tender into the swap.

Greece achieved a 96.9 per cent participation rate on €206 billion of eligible debt in the bond exchange after the government legislated to insert so-called collective action clauses into notes governed by Greek law retroactively, allowing a qualified majority of investors to agree on a loss that holdouts would also be legally obliged to accept.

Full article



© Bloomberg


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