Banks struggle on Greek aid | india | Hindustan Times
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Banks struggle on Greek aid

Global banks, under pressure from European governments to roll over their holdings of Greek debt, tried again to come up with a joint rescue plan on Thursday after talks over a French proposal fell apart.

india Updated: Jul 07, 2011 21:28 IST

Global banks, under pressure from European governments to roll over their holdings of Greek debt, tried again to come up with a joint rescue plan on Thursday after talks over a French proposal fell apart.

European Central Bank and Greek government officials and banking executives met lobby group the Institute of International Finance (IIF) in Rome on Thursday.

The banks are struggling to strike a deal which would let private sector creditors provide cash and breathing space to Greek debtors without being defined as a default by ratings agencies.

Besides, banks themselves are split on how best to construct the aid. Thursday's meeting followed a similar one organised by the IIF in Paris on Wednesday at which "a menu of options" was discussed.

A French proposal for a rollover in which bondholders would reinvest at least 70% of the proceeds from bonds maturing before the end of 2014 in new 30-year Greek debt has run into ratings agency objections.

Officials are now looking at a broader range of options.

Germany has raised possibilities including getting banks holding Greek bonds to swap them for new bonds with longer maturities but that proposal has not found favour with banks and some other European governments.