The response so far has been “very positive,” he said in a telephone interview. “There will not be a number coming out of Athens today or next week. At this moment, more than half of the Europeans have not even responded. It is too early.”
Credit-default swaps insuring Greek government bonds jumped 701 basis points to a record 3,727 basis points, according to CMA. The five-year contracts signal there’s a 94 percent probability the country won’t meet its debt commitments.
The results of the letter of inquiry, which was dated Aug. 25, will be “useful for us to plan our liability management,” Christodoulou said today. It would be “totally misleading” to describe the exercise as an offer and make the expected participation percentage public, he said. “I will know the number, but I’m not about to give it to anybody. It’s not a number that means anything because it is not binding.”
He declined to say what percentage of owners of the nation’s outstanding bonds the program has identified.
The proposed debt swap is part of a 159 billion-euro ($220 billion) European Union rescue plan agreed upon in July. Responses will be aggregated by regulators on a country-by- country basis, according to the Greek government.
The inquiry letter asks bondholders to respond to their local regulators by today. “Any decision you make to participate in such a voluntary transaction should be based on the final terms of the offer memorandum and not on the terms of this inquiry,” the letter says.
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