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Eurozone chiefs reach deal with bank bosses on Greek haircut
Date 27/10/2011 14:40  Author webmaster  Hits 952  Language Global
• 27 OCT 2011

By Leigh Phillips | EUobserver

BRUSSELS - Eurozone leaders have reached a deal with the world’s major banks under which they will accept a haircut of 50 percent on their holdings of Greek sovereign debt.

Early Thursday (27 October) morning, EU Presidents Herman van Rompuy and Jose Manuel Barroso announced that an agreement had finally been hammered out with the Institute for International Finance, the association representing the sector, after hours of stonewalling by the banks, who had refused to accept a write-down of Greek bonds exceeding 40 percent.

“It was agreed tonight there will be a nominal discount of 50 percent of notional Greek debt,” a weary Van Rompuy told reporters just after 4am in the European capital.

Earlier in the night, the managing director of the IIF, Charles Dallara, who led negotiations with EU premiers and presidents over the issue, had put out a statement saying bluntly: “There is no agreement on any element of a deal."

Earlier in the night, the managing director of the IIF, Charles Dallara, who led negotiations with EU premiers and presidents over the issue, had put out a statement saying bluntly: “There is no agreement on any element of a deal."

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See also:
Banks stonewall EU leaders on haircut (EUobserver)
EU cuts back-room deal on Greek debt write-down (EurActiv)
European Banks Have Until June to Raise Capital
(Reuters)