Belgian banks and insurers will not be pushed to accept Greek requests for a rollover of debt that matures after 2020, Luc Coene, the governor of Belgium’s central bank, said in an interview with L’Echo.
Euro-area governments are seeking to strike deals with their banks on a rollover amount in order to ease Greece’s debt burden. While the focus of these national talks has been on debt that matures up to 2020, Greek Finance Minister Evangelos Venizelos said this week that the timeframe may need to be extended if the initiative is to succeed in easing his country’s fiscal crisis.
“We limit ourselves to the options that were on the table,” Coene told the L’Echo in the interview published today. Post-2020 bonds will not be covered by discussions with Belgian financial institutions, he said.
The debt swap is part of Greece’s second rescue by the European Union and International Monetary Fund, a 159 billion- euro ($226.5 billion) package that includes 50 billion euros from bondholders that was agreed upon on July 21. Greece’s debt is forecast to peak at 161 percent of gross domestic product next year, according to European Commission projections.
Belgium’s three biggest financial institutions -- Dexia SA (DEXB), Ageas (AGS) and KBC Groep NV (KBC) -- are involved in the Greek debt talks, which will resume next week. Dexia is Belgium’s biggest owner of Greek government bonds, with holdings of 4.27 billion euros at the end of last year, according to its 2010 annual report. Ageas, the majority owner of Belgium’s biggest life insurer, reported Greek sovereign-debt holdings of 1.83 billion euros at the end of March and KBC said it held 600 million euros of Greek government bonds as of March 31.
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