THE GUARDIAN: Private investors take 'haircut' on Greek bonds in €100bn bailout that also strengthens European rescue fund
Europe's leaders are claiming a victory in the eurozone crisis after agreeing new deals that slash Greek debt and increase the firepower of the main bailout fund to around €1 trillion (£872bn).
Athens will be handed a new €100bn bailout early in the new year. The accord was reached in the early hours of Thursday after hours of debate.
At one stage talks broke down with holders of Greek debt but they ended up accepting a loss or "haircut" of 50% in converting their existing bonds into new loans.
Investors are likely to welcome the breakthrough. Sharp gains are predicted for European markets on opening, with the FTSE 100 being called up 75 points and similar rises expected on the German and French stock markets.
Angela Merkel, the German chancellor, helped broker the deal in talks with the bankers that also included the French president, Nicolas Sarkozy, and the head of the IMF, Christine Lagarde.
Merkel said the swap would take place in January. Sarkozy said private sector investors would refinance Greek's remaining debt at preferential rates while governments would find €30bn to go alongside €100bn from the private sectors. » | David Gow in Brussels | Thursday, October 27, 2011
Video: Eurozone and investors agree to halve Greek debt: Breakthrough in crisis talks as banks accept 50% cut to Greek bonds that will be converted into loans and euro rescue fund is strengthened »
Eurozone bailout deal for Greece – full text: Read the full euro summit statement on the agreement to halve Greece's bond debt to banks, provide bailout funds and bolster the EU's emergency finance system » | guardian.co.uk | Thursday, October 27, 2011
