There is no done deal yet between banks and the European Union on how much of a loss to take on Greek debt, the managing director of the Institute of International Finance Charles Dallara told CNBC.
It is “unclear whether or not a deal is done by tomorrow (Wednesday),” said Charles Dallara, who represents the banks in the talks.
Sources told Dow Jones on Tuesday that Germany, the euro zone΄s largest economy, is pushing for a 60 percent writedown on Greek debt. A 50 percent writedown is still on the table, those sources said.
On Monday, Dallara said that any deal forcing banks to take bigger losses on Greek debt “would be tantamount to default” and impose a high cost on European taxpayers, according to the news agency.
“Any approach that is not based on cooperative discussions and involves unilateral actions would be tantamount to default, would isolate the Greek economy from international capital markets for many years, and would impose a harsh burden on the Greek people as well as European taxpayers who have already done a lot to support Greece,” he said in a statement.
EU officials revise a plan agreed to in July and take bigger losses on the debt, but Dallara has warned against pushing too hard.
“There are limits …to what could be considered as voluntary to the investor base and to broader market participants,” Dallara said.
(source: capital)
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