FRANKFURT (MNI) – German banks can expect to write down the value
of their Greek bond holdings by 21%, the Association of German Banks
(BdB) confirmed Friday, refuting claims to the contrary.
In response to assertions made by the speaker for the opposition
parliamentary group Buendnis 90/Die Gruenen, Gerhard Schick, that German
banks might need to write down their Greek bond holdings by only 8.3%
due to the recent recovery in bond prices, BdB head Michael Kemmar said
the claims were “factually wrong” and “almost reckless”.
Such assertions would only add to an already tense situation,
Kemmar said in a press release.
Kemmer said the exchange offer makes it absolutely clear that the
interest rate on new Greek bonds will result in a 21% haircut or
reduction in the net present value of Greece’s sovereign debt that
matures between 2011 and 2020.
“That is also the case in changing market conditions,” he said.
–Frankfurt Bureau 069 720 142, email: frankfurt@marketnews.com–
[TOPICS: M$X$$$,M$G$$$,M$Y$$$,MGX$$$]
