The Golgotha of negotiations begins this week

The hard part is just starting…

 

Today Monday, marks the start of the effort for the …implementation of the summit agreement on a 50% cut on the Greek debt. That is, the contacts and negotiations between the finance ministry, the ODDHX and the IIF, the International Association of Banks on the voluntary participation of financial institutions/holders of Greek debt for the final impairment of Greek bonds; always aiming at the coveted 50%…


This process has a dual "role and mission". On one hand it is the practical way to deal with the Greek problem and the critical process that will show in the end whether the original agreement between European leaders and administrations of the banks will be finally implemented. On the other hand, European politicians will present it as the "final, comprehensive and sustainable response" to concerns and fears of the markets and other Member States of international organizations.

Meanwhile, the economic team is also required to answer questions about what will happen with insurance funds, with information talking about the speeding of the process by which state assets are transferred to pension funds, to cover a portion of losses they will suffer from the haircut on the bonds they are holding in their portfolios.

And all this while the complaints by leading analysts and their estimates as to how effective the Europeans will be in their decisions this time, are increasing.

And let's not forget that even the initiators of the haircut, like German finmin Wolfgang Schäuble, are still having doubts. And so they "warn" the bankers to participate in the voluntary debt cut, otherwise "it is possible that a less consensual way will be followed", as Schäuble said in "Spiegel" magazine.

At the same time, director of the IFF Charles Dalara, speaking to the German newspaper Welt am Sonntag, appears confident that at least 9 out of 10 banks will be participating in the process. However, he seems less optimistic with the corresponding positions of insurance companies on Greek bonds.

Throughout Europe, insurers have around 24 billion euros from the total 206 controlled by individuals and are invited to "join" the voluntary haircut.

But if this can be considered as a safe and positive first sample, Allianz, the German insurance giant, announced on Sunday afternoon that it will accept a 50% haircut on the Greek bonds it is holding…