Wednesday, February 22, 2012

The Killer paragraph of the Eurogroup Greek Statement

The official statement of this week's Eurogroup Meeting concluded in the early hours of Tuesday morning is linked here. The crucial/killer paragraph is as follows:

It is understood that the disbursements for the PSI operation and the final decision to approve the guarantees for the second programme are subject to a successful PSI operation and confirmation, by the Eurogroup on the basis of an assessment by the Troika, of the legal implementation by Greece of the agreed prior actions. The official sector will decide on the precise amount of financial assistance to be provided in the context of the second Greek programme in early March, once the results of PSI are known and the prior actions have been implemented.

We must now wait to see if a credit event is then deemed to have occured thus triggering payments on outstanding Credit Default Swaps.Good background is linked here, titled very fittingly, "Greece set on mechanical ventialtion".

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