Germany Bank Assn: No Greek Debt Relief Ahead Of Referendum

Author: Market News International | Category: news

Author: Market News International

BERLIN (MNI) – The German Banking Association (BDB) does not
believe that banks will actually carry out the 50% haircut on Greek
bonds before the Greek referendum on the bailout conditions has taken
place, BDB managing director Michael Kemmer said Wednesday.

“I don’t think that an actual bond swap — sealing the debt cut —
will take place before the referendum has been carried out,” Kemmer said
at a press conference here.

While the BDB head said he expects a “large majority” of banks to
agree to the 50% haircut on Greek bonds, he added that this willingness
“will be conditioned on a positive outcome of the Greek referendum.”

Kemmer said he believed that the Greek citizens will be “reasonable
enough” to approve of the bailout conditions in the referendum.

The banking representative said he does not expect any negative
impact on credit supply in the Eurozone from the uncertainties created
by the announcement of the Greek referendum.

Greece’s Prime Minister George Papandreou announced on Monday that
he will hold a referendum on the EU bailout deal, hinting that early
elections are possible if the referendum fails to win voters’ approval.

–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com

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