Two or three more bond issues after November
After this month’s scheduled swap of the 20 bonds from the 2012 haircut (PSI) that expire between 2023 and 2042 with up to five new bonds, the Finance Ministry’s plan foresees two or three forays into the money markets until the bailout program expires next August.
The government’s aim is to draw approximately 6 billion euros, for a total of 15 billion with the addition of 9 billion euros from the European Stability Mechanism, so as to cover the country’s funding needs up to the end of 2019. Therefore, ministry sources say, the state is likely to tap international markets twice with issues of 3 billion euros each, or three times with 2-billion-euro issues.
The cushion of 15 billion euros, to which Alternate Finance Minister Giorgos Houliarakis referred in parliament last week, is expected to serve as a sufficient guarantee for the markets to prevent a spike in Greek borrowing costs.
The aim is for the cushion not to be used at all. Speaking to lawmakers on Tuesday, Houliarakis said that if everything goes according to plan in the first couple of years after the expiry of the bailout program next summer, this sum of 15 billion euros could evolve into a stabilization fund for tackling a future crisis without having to resort to a new bailout program.
