By TraderVox.com
Tradervox.com (Dublin) – The Greek Government has managed to secure the 75 percent participation required to get the 130 euro-bailout. After closing the bond swap deal yesterday with optimism, it has now been confirmed that the bondholders’ participation exceeded the minimum requirement of 75 percent by registering an 83.5 percent overall participation. According to the Greece finance minister, 85.8 percent of private investors who hold bonds under the Greek law voluntarily agreed to accept the deal while 69 percent of those holding Greek bonds under foreign law took the deal. This tallied to an 83.5 percent overall participation that gives the Greek government to legally force wayward creditors to accept the deal.
By accepting this deal, bondholders have agreed to incur losses totaling to 75 percent of their investments. The deal involved writing down 53.3 percent of the value of the bonds and swapping their Greek debt for lower interest rate securities that will be offered by the Greek government. The Greek government has finally managed to escape bankruptcy and the threat to of its membership to the Euro region seems to have waned for now. The 130 billion Euros of its debt refinancing is expected to be available by March 20th when the government is expected to make repayment.
The euro-zone is scheduled to hold a phone conference to deliberate on the participation. The Greek finance minister indicated that the recalcitrant creditors have been given up to March 23 to comply with the deal.
Despite the strong participation by creditors and Greece securing the bailout money, there are some analysts who are very skeptical about the state of the Euro zone and Greece. Some have blatantly expressed this skepticism by claiming that Greece and Euro are finished since the second bailout does not accomplish anything worthy of note. They are citing the fact that the country has not had any growth for the last five years and its economy is on a negative spiraling trend, and expecting to register growth in the next two years after 130 billion euro bailout is “outright insane.”
Investors are now keen on the effects of the participation and economic analysts are waiting to see how Greece handles this situation.
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