Greek debt buyback attracts €31.8bn bids

 
City A.M. Reporter
GREECE’S debt buyback attracted bids totalling €31.8bn (£25.7bn), a senior Eurozone official said yesterday, but the average price paid for the bonds was slightly above expectations meaning the total debt reduction will be less than planned.

A banker involved in the operation confirmed the figures, saying that the average price paid for the bonds purchased was 33.5 cents on the euro.

The marginally higher-than-forecast price means that the operation had a shortfall of around €450m and the total debt reduction will be around 9.5 percentage points, less than the targeted 11 percentage points.

When that is factored in, it indicates that Greece’s debt-to-GDP ratio will fall to around 126.6 per cent in 2020, slightly above the 124 per cent that was agreed with the IMF last month, a figure that also takes into account further contingent measures.

While slightly below expectations, officials said it would not take much to close the gap.