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ESM Looking at Loan Duration Adjustments for Greece

ESM and EFSF General Secretary Kalin Anev Janse spoke to German newspaper Boersen Zeitung. In the interview he said that he had been asked to look at long-term and short-term reforms to Greece. He said, however, that no announcements have been made as the political procedure has yet to be completed regarding these reforms.
Three factors are being examined:

  •  The normalization of repayments. The average repayment date is 28 years. “We can increase this to 32.5 years to adjust repayments and avoid large increases to the profiles of repayments,” he said.
  •  “Secondly, we are looking at measures to reduce the danger from interest rates,” he said.
  • The lifting of a large interest rate increase in 2017 for a small portion of the Greek debt is the third factor being examined.

Asked if the ESM was looking at lengthening the time limit for bonds. The ESM will need to examine maturity dates. “Our longest loan in duration for Greece ends in 2059, that is in 43 years,” he pointed out. “The lines we have, allow us to give loans of 45 years in duration. However, because the longest loan for Greece is at 43 years, we will not issue bonds of a longer duration.”

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