zwar schon etwas her, aber dennoch wichtig (zur Erinnerung) // // At a meeting at the European Central Bank on Thursday, governors held a vote on a proposal to swap the Greek government bonds which the central banks had bought at steep discounts on secondary markets for freshly issued bonds..// t would, the head of the German central bank argued, expose the ECB to a possible lawsuits from any private creditors who are unhappy about the moves by the ECB to exempt itself.

ECB governors voted on Greek bond swap: source

Eurozone central bank chiefs held a vote this week on helping Greece with its debt via an exchange of Greek government bonds, a source familiar with matter said on Friday.

At a meeting at the European Central Bank on Thursday, governors held a vote on a proposal to swap the Greek government bonds which the central banks had bought at steep discounts on secondary markets for freshly issued bonds.

According to the daily Die Welt, such a swap was agreed and already in progress for completion by Monday.

The profits from the transactions will then be distributed by the ECB to eurozone member states to enable the money to eventually benefit debt-laden Greece, the newspaper, quoting "well-informed sources".

It would be a way for the ECB to help out Greece without taking a so-called "haircut" on the portfolio of bonds, which central bank chief Mario Draghi has rejected as a form of "monetary financing".

That refers to a policy whereby a government in effect prints money to boost liquidity and is illegal under the ECB's statutes.

Draghi and other governing council members have, by contrast, appeared to suggest that the ECB may be open to contributing any profits made on the holdings of Greek bonds.

Greece's private creditors are being asked to write off about half of the 200 billion euros' ($265 billion) worth of government bonds they hold to help cut the country's total debt burden to a sustainable level.

The ECB has come under pressure to take losses on the Greek government bonds it holds, too, as the restructuring by private creditors is unlikely by itself to bring down Greece's debt to the target of 120% of GDP in 2020 from 160 percent at present.

The ECB refused to comment on the debt swap.

But a source familiar with the matter told AFP that a vote was held and Bundesbank president Jens Weidmann voted against it.

It would, the head of the German central bank argued, expose the ECB to a possible lawsuits from any private creditors who are unhappy about the moves by the ECB to exempt itself.
Weidmann was also concerned that investors could lose confidence in the eurozone as similar debates may arise around the bonds of other troubled states such as Portugal, worsening the crisis, the source said. -Sapa-AFP

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