Agreement on crisis summit – The Blender Brussels
And private investors must bleed! Skillfully spread Merkel, Sarkozy & Co. this message as a result of the summit. But however the situation clearly is not. The most important questions and answers about the Brussels agreement and its consequences.
The euro-zone countries have agreed on a new rescue package for Greece. The most important questions and answers.
What the Special Summit has decided exactly?
In essence, a new aid package for Greece. The strapped state will adopt some of its 350 billion euro debt. The euro-zone countries and the International Monetary Fund (IMF), with a total 109 billion euros, the main burden to come to – allegedly – € 50 billion from private creditors. In addition, Heads of State and Government, the duties of the euro rescue fund EFSF extend to prevent the crisis spilling over to other Euro countries.
Greece now has the formal default – the infamous “default”?
Before publication of the details of the rescue plan is unclear whether this is the end to give a uniform assessment. The involvement of banks has so far been declared as “voluntary.” Whether they remain genuinely voluntary, is open. “The practical implementation of the creditor’s participation might still cause some uncertainty in the markets,” warned Bank Association CEO Michael Kemmer. There are still some important variables of the decisions by the euro-summit to be clarified. The rating agency Fitch announced and dashed in front while the Greek bonds rated “limited-payment” to be provided. The Derivatives Association ISDA sees no reason however for a “credit event”, ie, a formal default. This assessment is of great importance, because the spread is to prevent the crisis on the market for credit derivatives as credit default swaps (CDS). A devastating chain reaction, such as after the collapse of Lehman Brothers, which had been triggered by the time the CDS appears to be so unlikely.
Greece has more time to pay down debt?
Yes. The term of the loans should be at least doubled the EFSF to 15 years – but it may well rise up to 30 years. Also extended the maturities of the Greece-aids, which are handled directly by the nation states – in Germany about the state development bank KfW.
How high is the involvement of the private is actually?
It is probably much lower than one would imagine the expression of Josef Ackermann. “It hits us hard,” was the German bank chief decisions of the EU summit commented. But lawyers do not share this assessment: “This package is for sale as bank participation is hard to accept,” criticizes Reifner Udo, a professor of business law at the University of Hamburg and scientific director of the Institute of Financial Services. “Much more honest you would have to say: This is a bank rescue package.”