ATHENS, Greece — Investors with at least 58 percent of the Greek bonds eligible for the nation’s debt swap have so far indicated they’ll participate, putting the country on the verge of the biggest sovereign restructuring in history.
Greece’s largest banks, most of the country’s pension funds, and more than 30 European banks and insurers, including BNP Paribas, Commerzbank and Assicurazioni Generali, have agreed to the offer. That brings the total so far to at least $157 billion, based on data compiled by Bloomberg from company reports and government statements.
The goal of the exchange is to reduce privately held Greek debt by 53.5 percent and turn the tide against the debt crisis that has roiled Europe for more than two years. The government said it will use collective action clauses to force holders of Greek-law bonds into the swap if the so-called private-sector involvement falls short and it gets sufficient approval from investors to change the bonds’ terms.
“Adding up the commitments to participate in the Greek PSI, it is now clear that the CAC hurdles will very likely be cleared,” Commerzbank’s head of fixed-income strategy, Christoph Rieger, said in a note Wednesday. Under the rules of the exchange, investors holding at least 50 percent of the eligible bonds must vote on the swap, and 66 percent of those must agree to amend the bonds to enable the government to impose the collective action clauses, Rieger said.
The offer ends at 10 p.m. today Athens time.
Hans Humes, president of Greylock Capital Management, expects holders of more than 80 percent of Greece’s government bonds to accede to the swap, he said in a Bloomberg Television interview Wednesday.
