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Friday, March 09, 2012

Greece Defaults

As expected, the "voluntary" take up of new Greek bonds for old has not reached the 90% threshold necessary for it to be considered "voluntary".

85% of Greek holders of bonds (bound by Greek law) agreed to the deal (ironically the Greek Finance Ministry employees' pension fund was among those that did not agree to a "voluntary" participation), whilst only 69% of non-Greek debt (bound by English law) participated. Needless to say Greece has attempted to move the goalposts on the latter, by extending the period for participation to March 23 (yesterday they denied that they would do this).

Whatever the fiddles and fudges that Greece now attempts, the fact remains that the 90% threshold has not been reached and that CACs will have to be used; ie Greece has defaulted.

For form's sake Isda has announced that its determinations committee will meet at 1pm GMT today, to discuss a potential credit event in Greek CDS. 

After that the whole process will be mired in litigation.

Oh, and by the way, does anyone really believe the figures announced by Greece?

Only when they are fully audited by a genuinely independent person/organisation may we have any real faith in the numbers.

Here is a link to the full press release from the Hellenic Republic Ministry of Finance (for what it is worth).

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