Greece rolls over 6-, 3-month T-bills in successful auction

Cash-strapped Greece sold 2.925 billion euros ($3.31 billion) dollar) of six- and three-month T-bills on Wednesday to refinance two maturing issues as its government wrangles with its euro zone backers and the IMF over an aid-for-reforms deal.

Despite an increasingly dire financial position as bailout aid remains frozen, Athens has been able to find domestic buyers to plug any gaps resulting from foreign investors’ refusal to roll over their own Greek T-bill holdings.

Greece’s debt agency PDMA sold 1.625 billion euros of six-month paper at a yield of 2.97 percent, unchanged from a previous sale last month.

The sale’s bid-cover ratio was 1.30, unchanged from May, and showing no deterioration in demand despite tight liquidity conditions.

The amount raised included 375 million euros in non-competitive bids. The settlement date for Wednesday’s auction will be June 12.

PDMA also sold 1.3 billion of three-month T-bills at a yield of 2.70 percent, with the auction’s cover ratio at 1.30.

Greece has asked its EU partners and the International Monetary Fund to allow an increase in the amount of T-bills it can issue to deal with its cash crunch and debt repayments.

But the European Central Bank has resisted calls by Athens to bridge its funding gap by having banks buy more short-term government debt before the country’s bailout is back on track.

Greece faces another rollover later this month as 1.6 billion euros of three-month T-bills mature on June 19. (1 US dollar = 0.8832 euro) [Reuters]