Greece’s Public Debt Management Agency (PDMA) is awaiting the green light from the finance minister at any moment to proceed with a new return to the markets with a major bond swap.
The government has informed its European interlocutors – the European Commission, the ECB and the ESM that the move may come “any minute”.
The swap involves 20 bonds with a nominal value of 29.7 billion euros that had been issued in 2012 – in the framework of the major PSI (Private Sector Involvement) debt write-down – which will be swapped for five bonds with the same par value, and a maturity date of between five and 25 years.
This time the debt management agency will not seek new capital from the markets, but instead aims to change the debt structure in order to welcome “regular investors”, besides the hedge funds.
This is considered the “passport” for Greek bonds pass from junk level to BBB investment grade.
This procedure is expected to avert potential problems with the European Central Bank in the event that it decides to include Greece in the quantitative easing (QE) programme, a longstanding aim of the government.
In addition, it allows Greek bonds not to have to compete with those of other countries that are in the same category but with smoother standard characteristics.