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Salty interest for another tranche of government securities

26 January 2010 / 09:01:22  GRReporter
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Greece sold government bonds for €8 billion, while demand from investors reached €25 billion. Analysts from various investment banks and rating agencies evaluate the tender as the first swallow, which will start the exit of the crisis. The common European currency also reacted positively - the value of the euro against the dollar climbed by 0,4 percent.

    As the Greek Ministry of Finance reports, the offer of €25 million by investors is the largest to date and the sale of securities worth €8 billion is recognized as a great success. Same department, however, recognizes the high interest for debt service, which requires the country to do everything possible to restore investor confidence and strengthen public finances. The Spread-index of the 5-year notes sold yesterday formed at 350 points, the spread-index of the 10-year bonds in comparison to the German bonds fell with 5 points, and stopped at 305 units.

    For international analysts this is positive news, but they maintain the current credit ratings of the country and their negative outlook for the economic development. Sarah Carlson, chief analyst of Moody's agency recognizes that it was very important for the Greek state to have a successful tender and this shows that it will surely be able to fund its own state debt during 2010. "The most important thing for Greece is to implement the measures. This is about policy and social responsibility," she adds.

    "Certainly the interest of the loan is very high. This shows how important is for our country to fulfill its budget and restore confidence in markets,” emphasizes Nikos Manginas from National Bank of Greece. "There were many doubts as to whether this first tender will be successful. But for an investor who assumes that Greece will not bankrupt, the supply was very beneficial. But let us not be put off - the situation in Greece will not change overnight. Debt continues to be extremely high and the ratings of the country are the same," warns Ioannis Sokos from BNP Paribas.

 After successful completion of the tender with the Greek Securities, the value of the euro rose by 0,4 percent against the dollar and formed to be 1.4191 Dollars. The shares of Greek banks on the Athens Stock Exchange increased 3.87 percent, after the significant losses from last week.

Tags: Economy Greece Credit rating Spread index Moodys
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