The clock is ticking for Greece, as a deal must be reached before March 20.
Three months of negotiations ground to a halt on Friday night, amid a wave of
downgrades by ratings agency Standard & Poor’s aimed at a clutch of European
countries, including France.
The unexpected breakdown in talks between Greece and its private-sector creditors has taken the country a step closer to bankruptcy after a failure to sign up lenders to a voluntary and “orderly” 50pc haircut to their holdings.
Greece’s finance minister Evangelos Venizelos said talks would resume on Wednesday to “bridge differences” but insiders remained sceptical that a deal could be stitched at such a late stage.
The clock is ticking for Greece, as a deal must be reached before March 20, when the country is due to receive a further €130bn (£107bn) bail-out tranche from the International Monetary Fund and must make a key €14.5bn bond payment.
The problem centres on the difference between lenders agreeing to a “voluntary” and orderly default – which would mean swapping into bonds with a lower value – and lenders refusing terms, which would cause a default.
The unexpected breakdown in talks between Greece and its private-sector creditors has taken the country a step closer to bankruptcy after a failure to sign up lenders to a voluntary and “orderly” 50pc haircut to their holdings.
Greece’s finance minister Evangelos Venizelos said talks would resume on Wednesday to “bridge differences” but insiders remained sceptical that a deal could be stitched at such a late stage.
The clock is ticking for Greece, as a deal must be reached before March 20, when the country is due to receive a further €130bn (£107bn) bail-out tranche from the International Monetary Fund and must make a key €14.5bn bond payment.
The problem centres on the difference between lenders agreeing to a “voluntary” and orderly default – which would mean swapping into bonds with a lower value – and lenders refusing terms, which would cause a default.
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