Greece says nearly 80% support debt swap

From FT

The Greek government is expected to announce the results of the two-week campaign to win over private investors on Friday morning, but senior Greek officials and bankers briefed on the results said close to 80 per cent of debt in private hands agreed to be swapped for new bonds worth less than half current face value.

The Greek government is now expected to trigger so-called “collective action clauses”,introduced into bonds in recent law, to impose the 53.5 per cent loss on all holders of bonds issued under Greek law. In order to use the CACs, Athens needed 66 per cent of participants to agree the deal; by getting close to 80 per cent, the hurdle would be cleared safely.

Once CACs are triggered, all €177bn in Greek-law bonds will be swapped for a cash payment equal to 15 per cent of the old bond and new Greek bonds worth 31.5 per cent – wiping about €100bn from Athens’ €350bn debt pile.

In addition, the status of the 14 per cent of Greek debt not issued as Greek-law bonds, most of which are bonds governed by English law, remained unclear. According to a confidential analysis prepared for eurozone finance minsters last month, 95 per cent of all bondholders must be included in the debt restructuring for Greece debt to reach 120 per cent of economic output by 2020, the target of its new €130bn bailout