Greece’s market return may be imminent: bankers, investors

Greece could return to financial markets in the next few weeks, investors and bankers close to the discussions told Reuters, raising private cash that would mark an important step towards ending its dependence on official funding next year.

Athens' largest creditor, the European Stability Mechanism, said on Monday that Greece should develop a strategy to end a three-year exile from markets before its current bailout program expires in mid-2018.

Greek finance minister Euclid Tsakalotos met with investors in London last month and one of those funds, BlueBay Asset Management, said the volume of calls they are receiving from bankers about a potential deal suggest it's very close.

"Over the last few months we would get one call on this every couple of weeks (from bankers), but over the last 10 days it seems to be every day I'm getting a call asking about this particular topic," BlueBay's Mark Dowding told Reuters.

"One senses we are getting to a point where this feels more imminent. We could well expect to see a deal in the next couple of weeks before investors depart for their summer holidays."

Dowding said BlueBay holds Greek bonds and would buy a new bond issue if the price was attractive.

Tsakalotos also met investors including the world's biggest bond fund PIMCO and US-based asset manager Standish, sources close to those meetings told Reuters. PIMCO declined to comment.

The Greek finance ministry was not immediately available for comment. A senior Greek government official told Reuters last week that no decision had yet been made on the timing of a deal.

A banker advising Greece on its market return told Reuters on condition of anonymity: "They (Greece) are monitoring the market and they are trying to do something right now, so I wouldn't rule out a deal within the next week or two."

"I think they would like to send a signal that they don't depend solely on the Troika anymore for funding. It's more like a political statement, they are being driven politically to do a deal," the banker said.

A second banker said a sale in the next few weeks was possible although it may yet be pushed back until after German elections in September. He said Greece could expect to raise at least 3 billion euros in the debt sale. 

Greek economy minister Dimitri Papadimitriou, who recently visited the United States and Britain, said in an interview with a local newspaper on Sunday that some investors have shown great interest in the timing of Greece's return to markets.

Reuters first reported in May that Greece was eyeing a sovereign bond issue as early as July. A Greek government official said it would likely be a new five-year bond, some of which could be swapped for debt maturing in 2019.

Greece will return to markets once its benchmark borrowing costs drop below 5 percent, sources separately told Reuters last month, a level it is fast approaching.

Greece last ventured into international bond markets with two issues in 2014, a year before it plunged into crisis via a tense standoff between lenders and Greece's newly elected left-wing government which vowed to end bailout-induced austerity.

That part of the crisis ended with the country signing up to a new bailout, its third since 2010.

[Reuters]