Saturday December 20, 2014 Search
Weather | Athens
17o C
10o C
News
Business
Comment
Life
Sports
Community
Survival Guide
Greek Edition
Bankers set to oppose buyback plan

 Bond scheme is bereft of financial logic as it constitutes double borrowing, credit sector chiefs argue

By Yiannis Papadoyiannis

Bank managers are planning to express their opposition to the credit sector’s likely participation in the bond buyback program at a meeting with Finance Minister Yannis Stournaras scheduled for Thursday.

The administrations of all commercial banks are stressing that they cannot possibly participate voluntarily in a program that leads to the financial exhaustion of shareholders.

Senior bank officials told Kathimerini that besides the legal consequences of a possible voluntary participation, such a serious decision, which would signify a change in the lenders’ portfolios, cannot be approved by their governing boards alone. They underlined that such a decision would require discussion and approval at general shareholders meetings, but that would compromise the buyback plan as it is a process that takes time.

In their meeting with Stournaras the bank managers will ask for their exemption from the buyback and propose alternative solutions to the problem.

They will also request changes to the terms of the recapitalization process. The main point is how to reduce the amount of capital requirements, which could take place via the bond swap or through the guarantee of bank bonds by the European Financial Stability Facility (EFSF), which would allow for their valuation at their nominal value. That would reduce capital needs by 11 billion euros at once and render recapitalization much more attractive for private shareholders. The more funds private investors contribute in the recapitalization process, the less money the state will have to pay through the Hellenic Financial Stability Fund (HFSF).

Bank officials argue that the scheme proposed for the buyback process is bereft of financial logic as it constitutes double borrowing and additional burdening for taxpayers. By contrast, they say, the guarantee of bonds would have a better result at no additional cost. However these alternative plans were rejected by the representatives of the country’s creditors a few weeks ago and there is no sign of them changing their attitude on the issue.

Analysts say that banks are right to protest as in spring they were burdened by the 53.5 percent bond haircut and a few months later the state is asking to buy the bonds back at 30 percent of their value.

ekathimerini.com , Thursday November 29, 2012 (00:34)  
Workers rush to get early retirement
Piraeus Containter Terminal goes from strength to strength
Moscovici: Creditor inspections to become less frequent and ‘lighter’
Property capital gains tax halt
Tsipras admits there could be hard days ahead
SYRIZA leader Alexis Tsipras said on Friday that he is determined to implement his party’s economic program if it comes to power but admitted that it would experience a challenging period. “...
Public medical centers keeping up despite shortages
Despite having just 1,050 doctors, medical centers belonging to Greece’s public health system (PEDY) saw more than 200,000 regular and emergency patients, made over 3,500 house calls and iss...
Inside News
SOCCER
Abidal cuts short playing career at Olympiakos
Former France and Barcelona defender Eric Abidal announced his retirement from football on Friday, a day before his last match. Abidal said he will finish after playing for Olympiakos agains...
SOCCER
PAOK loss at Giannina brings Olympiakos to within a point
The bad losses that PAOK and Panathinaikos suffered on the road on Thursday allowed Olympiakos to gain significant ground on the table and come to within one point from the top after the mid...
Inside Sports
COMMENTARY
New weapons of diplomacy
Hollywood screenwriters couldn’t make it up: That Sony, one of the world’s biggest film producers, would be forced to pull a comedy about the assassination of North Korea’s dictator after a ...
EDITORIAL
Oblivious to change
The world around us is undergoing many important changes while we sit around stewing in our own juices. US President Barack Obama is actually talking with Cuba’s Raul Castro, for example, bu...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
 RECENT NEWS
1. Tsipras admits there could be hard days ahead
2. Public medical centers keeping up despite shortages
3. Workers rush to get early retirement
4. Piraeus Containter Terminal goes from strength to strength
5. Moscovici: Creditor inspections to become less frequent and ‘lighter’
6. Property capital gains tax halt
more news
Today
This Week
1. Ship with 200 migrants off Pylos towed to Italy after passengers refuse to stop in Greece
2. Independent Greeks MP Haikalis claims attempted bribery for presidential vote
3. Greek PM Samaras confronts peril putting his Greek transformation to vote
4. Independent Greeks leader backs MP's bribery claims, threatens to release video [Update]
5. Gov't spokeswoman says bribery claims 'badly-played charade,' heralds legal action if evidence not produced
6. Former premier Mitsotakis to meet President Papoulias to discuss political upheaval
Today
This Week
1. Juncker warns Greeks against voting 'extreme forces' into power
2. Romanos and the dilemma
3. Samaras summons bond vigilantes with euro exit talk
4. A friendly yet firm message from Pierre Moscovici
5. Europe's drama in Greece needs final act to avoid tragedy
6. High stakes
   Find us ...
  ... on
Twitter
     ... on Facebook   
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2014, H KAΘHMEPINH All Rights Reserved.