Bloomberg News

Financial Firms Agree to 50% Nominal Discount on Greek Debt

October 26, 2011

Oct. 27 (Bloomberg) -- The Institute of International Finance said it has agreed to develop a concrete voluntary agreement to aid Greece on the basis of a nominal discount of 50 percent on notional Greek debt held by private investors.

This will include “the support of a 30 billion euro official PSI package,” Managing Director Charles Dallara said in the e-mailed statement, referring to private sector involvement. “This should set the basis for the decline of the Greek debt to GDP ratio with an objective of reaching 120 percent by 2020.”

The specific terms and conditions of the voluntary PSI will be agreed by all relevant parties in the coming period and implemented with immediacy and force, the IIF said. The structure of the new Greek claims will need to be based on terms and conditions that ensure a net present value loss for investors fully consistent with a voluntary agreement, it said.

To contact the editor responsible for this story: Aaron Kirchfeld at

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