IIF’s Dallara; Greek swap will be successful, high involvement

ATHENS (Reuters) – The chief negotiator for the body representing private sector holders of Greek bonds expressed confidence on Saturday that a bond swap deal which is a key part of Greece’s bailout program would be completed successfully next week.

“We can sense in our discussions with investors that momentum is building,” Charles Dallara, managing director of the International Institute of Finance (IIF), told Greece’s Antenna television in an interview.

“I’m quite optimistic that the participation levels will be quite high,” he said, but he declined to predict a figure.

Bondholders have until March 8 to sign up to the agreement under which they will exchange their existing Greek government bonds for new paper in a swap deal that will see the nominal value of their holdings cut by 53.5 percent.

Failure to secure a deal with private sector creditors would threaten the 130-billion-euro bailout package agreed last month with the European Central Bank, the European Union and the International Monetary Fund.

Greece has said it would not be obliged to go through with the arrangement unless it gets 90 percent participation. If participation is below 90 percent but above 75 percent, it would consult with its public sector creditors.

Assuming a sufficient number of investors accept the deal, European leaders should give final approval to the bailout in a teleconference on March 9.