Greece ‘wins 75% approval’ for debt swap

Enough Greek creditors have agreed to take part the country’s vital debt swap deal, according to reports.

But some bondholders continue to show reluctance to write down the value of the Greek government debt.

The BBC says a Greek government official claims over three-quarters of its creditors have agreed to take a 53.5% cut in the value of their bonds.

Greece had to get at least 75% of bondholders to sign up to the plan by 2000 GMT tonight to avoid default. Without the agreement, the country may not receive its €130 billion (£108.6 billion) bailout from the international community.

The haircut will see about €107 billion written off of Greece’s €206 billon debt mountain. The deal is being carried out alongside deep-cutting austerity measures designed to take debt down to 120.5% of GDP by 2020. (article continues below)

The Greek Public Debt Management Agency will publish an announcement on the take-up of the swap at 0600 GMT tomorrow, according to the AFP news agency.

However, Patrick Armstrong, managing partner at Armstrong Investment Managers, told the BBC that that he sees “no incentive” to participate in the debt swap.

“I’m not in the business for altruistic reasons,” he commented. “Capital markets function best when people are out to deliver return on capital investment.”