BUSINESS

Helsinki receives 264-mln-euro collateral payment from Athens

Finland received 264 million euros in collateral payments from Greece that it demanded as a condition for contributing to the second bailout of the debt-burdened southern European nation.

The latest installment brings Greek collateral payments to Finland to 831 million euros to date, the Finance Ministry in Helsinki said on Friday in an e-mailed response to questions. Greece made previous payments in April and May, and is due to pay 925 million euros in total, disbursed gradually as the country gets the funds from its second bailout.

Finland was the only country to demand collateral to limit liabilities to taxpayers for any rescues that don’t give it priority creditor status. It negotiated a similar deal with Spain for its bank bailout.

Under the accord, Greek bonds will be transferred from Greek banks to a trustee, which will sell them and invest the proceeds in the five highest-rated sovereign bonds in the euro area.

In exchange, Finland has paid its share of the capital of the European Stability Mechanism upfront. Finland will also forgo any profits made from the loans to Greece.

[Bloomberg]

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