Thursday, June 30, 2011

German Banks Agree to Roll Over Greek Debt

New York Times
June 30, 2011

The biggest financial institutions in Germany followed the lead of their French counterparts Thursday by agreeing to roll over some of their holdings of Greek debt — a crucial step toward obtaining international agreement on a second bailout for the crippled Greek economy.

The German finance minister, Wolfgang Schäuble, said in Berlin that banks and insurance companies were “prepared to participate in a second aid program for Greece” as part of a wider European deal.

The news added to the relief in global markets after the Greek Parliament approved laws Wednesday and Thursday enabling new government spending cuts and revenue-raising steps.

The president of the European Commission, José Manuel Barroso, and the president of the European Council, Herman Van Rompuy, said in a statement Thursday that with the Greek Parliament’s actions, “the conditions are now in place for a decision on the disbursement of the next tranche of financial assistance for Greece and for rapid progress on a second assistance package.”

But other officials cautioned that a broader agreement on new aid for Greece was far from certain, in part because of requirements imposed by international lenders to ensure that Greece’s debt problems are contained.


No comments: