Tuesday April 28, 2015 Search
Weather | Athens
14o C
09o C
News
Business
Comment
Life
Sports
Community
Survival Guide
Greek Edition
Fitch downgrades Greece on debt swap plan

 Credit rating agency puts Athens on lowest level above a default

Fitch cut Greece's long-term ratings on Wednesday to its lowest rating above a default, becoming the first ratings agency to make the widely expected downgrade after the country announced a bond exchange plan to ease its massive debt burden.

It said Greece would be designated as having technically defaulted after the bond exchange is formalised, but the new bonds would be give and new rating.

All three big ratings agencies -- Fitch, Moody's and Standard & Poor's -- downgraded Greece in July when an initial debt swap plan was unveiled and have warned that losses for private creditors would trigger a temporary default.

As expected, Fitch said it was downgrading Greece to «C» from «CCC,» and would follow up with further downgrade to a «restricted default» when the bond swap is completed.

It will then reassess the country's ratings when new bonds are issued as part of the debt exchange.

"It would come out to a low, speculative grade rating,» Fitch analyst Paul Rawkins told Reuters on the ratings after the reassessment, noting that rating would factor in the country's economic prospects and new debt profile.

He added that the current process of downgrades was largely procedural, following the path laid out by the agency in June. Ratings, which give an estimate of the capacity of a creditor to repay its debt, usually serve as a guide to investors.

Euro zone finance ministers agreed a 130-billion euro rescue plan for Greece on Tuesday to avert a messy default, including a bond swap to shave 100 billion euros off Greece's debt burden.

Bondholders will take losses of 53.5 percent on the nominal value of their Greek bonds as part of the swap, with actual losses put at around 74 percent in real terms.

The European Central Bank has agreed to a complex plan to ensure Greek bonds can still be used as collateral in its lending operations whilst in the process of being swapped.

Greece will take a loan from the European Financial Stability Facility (EFSF) which will come in the form of EFSF bonds. Those bonds will passed to ECB and put into a special account in case there are any losses on collateral during the short window of the bond swap.

[Reuters]

ekathimerini.com , Wednesday February 22, 2012 (17:26)  
Discreet Tsakalotos tapped to salvage troubled Greek loan talks
Greece to offer taxpayers a deal to get money back home
Greek shares outperform amid bailout deal hopes
Cyprus central bank head says ready to act if Greece spills over
Eurogroup´s Dijsselbloem says Greece will not make it without aid
The head of the Eurogroup said on Tuesday that a recent shakeup of Greek Prime Minister Alexis Tsipras’ negotiating team would not by itself resolve the impasse between Greece and its credit...
Greek, Turkish Cypriot leaders to kick start peace talks
Greek Cypriots unveiled measures on Tuesday to boost trust across the ethnically divided island, and announced that rival leaders would hold their first meeting in months on May 2. Peace tal...
Inside News
BASKETBALL
Rethymno defeats in-form AEK on Crete
AGO Rethymnou put an end to a positive string of results for in-form AEK, while PAOK survived a strong challenge by Kolossos Rhodes in Thessaloniki in yet another exciting weekend of basketb...
SOCCER
Panathinaikos beats Xanthi to rise to second
Panathinaikos jumped back up to the second spot of the Super League after its home win over Xanthi on Saturday, as PAOK slumped to third due to its draw at home with PAS Giannina on Sunday. ...
Inside Sports
COMMENTARY
The Good, the Bad and the Ugly
It is so exhausting and unpleasant for average Greek citizens to keep hearing for weeks now that the country’s cash reserves will run out in two months, one month, next week, and especially ...
EDITORIAL
Better late than never
Three precious months were lost in the government’s negotiations with the country’s international partners and creditors, as some of its officials wasted time on their own self-promotion, ha...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
 RECENT NEWS
1. Eurogroup´s Dijsselbloem says Greece will not make it without aid
2. Greek, Turkish Cypriot leaders to kick start peace talks
3. Discreet Tsakalotos tapped to salvage troubled Greek loan talks
4. Greece to offer taxpayers a deal to get money back home
5. EU lawmakers demand migrant burden be shared
6. Dijsselbloem says Greece will not make it without aid
more news
Today
This Week
1. The Good, the Bad and the Ugly
2. Creditors to demand extra measures of 3 bln euros
3. Plan on the cards for flat VAT rate of 18 pct
4. Greek PM says people may have to rule on creditor deal [Update]
5. Greek PM says initial deal in bailout talks 'very close'
6. No trolley buses from 11 a.m. to 4 p.m.
Today
This Week
1. Greek government's popularity takes a hit as talks drag on
2. Denialism
3. Europe's collision course with Greece
4. It's up to the Greek government to ensure deal with lenders, says ECB's Coeure
5. Leaving the past in the past
6. Greece’s day of reckoning inches closer as debt payments loom
   Find us ...
  ... on
Twitter
     ... on Facebook   
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2015, H KAΘHMEPINH All Rights Reserved.