Schaeuble:Eurogroup Agrees On Debt Buyback Program For ...

BERLIN (MNI) ? German Finance Minister Wolfgang Schaeuble said
Wednesday that Eurozone finance ministers had made progress in their
talks on how to close a E14 billion financing gap in the rescue program
for Greece.

?We have joint ideas how this gap can be covered,? Schaeuble told
reporters here. ?We agree that a debt buyback program can be
undertaken,? he said.

In order to finance this debt buyback program, Germany favors an
increase of the funds of Europe?s temporary rescue fund, the European
Financial Stability Facility (EFSF), by E10 billion, the minister said.

Other Eurozone governments would rather like to see the interest
rate on the loans to Greece reduced to close to zero, Schaeuble said.
While Germany and some other states want to lower the interest rate only
by 90 basis points from the current 150 basis points above Euribor,
other governments want to cut it to 25 basis points above zero.

A potential deal may also allow states to choose from among
different options for Greek debt relief, Schaeuble said. Some could opt
for cutting the interest rate more deeply, while others could go the way
of an EFSF increase, he explained.

Some states might also hand over to Greece the profits they get
from their national central banks from the ECB?s previous SMP bond
buying program, Schaeuble said. The profits are estimated
to total E4.2 billion, he said.

Schaeuble said he was ?confident? that the Eurogroup and the
International Monetary Fund would reach an agreement by next Monday and
that Germany?s lower house of parliament, the Bundestag, could vote on
the Greek aid deal the following Friday.

?Berlin bureau: +49-30-22 62 05 80; email: twidder@mni-news.com

[TOPICS: M$X$$$,M$G$$$,MGX$$$,M$$CR$,MT$$$$,M$Y$$$]

Source: http://www.forexlive.com/blog/2012/11/21/schaeubleeurogroup-agrees-on-debt-buyback-program-for-greece/

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