Greece's ratings factoring in third bailout
Greece's bonds and credit ratings are factoring in a third bailout for the nation that analysts and investors say will require greater concessions from its international creditors.
Within a week of euro-area member states giving their formal approval to a second bailout package for Greece, the International Monetary Fund said the country may require additional funding or a further debt restructuring. Pacific Investment Management Co, which runs the world’s biggest bond fund, said it remains “cautious” on euro-area government debt even after the largest-ever sovereign refinancing because the risk remains that Greece will leave the single-currency area.
“It’s still a very steep mountain to climb,” said Harvinder Sian, a senior fixed-income strategist at Royal Bank of Scotland Group Plc in London. The restructuring deal “doesn’t do anything to put Greece on a sustainable path,” he said. “A third bailout will become necessary.”
The price of Greek government bonds maturing in February 2042 that were provided as part of its debt exchange was at 21.48 cents on the euro at 8.04 a.m. London time, with yields at 15.02 percent. Standard & Poor’s said on March 15 it rated the securities CCC, its fourth rank above default, citing questionable growth prospects, a weakening political consensus to implement budget cuts and a “still large” debt burden.
Sellers of credit-default swaps on Greece will have to pay as much as $2.5 billion to settle contracts triggered by the nation’s debt restructuring, an auction determined on Monday.
Yields on Portuguese bonds due in 2037 were at 11 percent, with the price at 41.835 cents. The securities are rated BB by S&P, six steps above the new Greek securities.
Greece’s ratio of debt to gross domestic product will fall to 116 percent in 2020 from 165 percent in 2011 if the nation’s “ambitious” program to overhaul the economy is implemented, according to a report posted on the website of the European Union’s executive arm last week.
Striking Sotiria Hospital workers storm administrator's office
A group of a few dozen protesting workers and doctors stormed the office of the president of the board of directors of Geniko Kratiko, Giorgos Papadopoulos, who also runs Sotiria following the merger of the two hospitals' administrations.
The merger of Sotiria and Genimata is scheduled to be completed by the beginning of 2013 in one of a number of such moves announced by the Health Ministry to streamline operations and cut costs.
Speaking on Skai Television on Tuesday morning, the director of Sotiria's Medical Service, Dimitris Valdekis, warned that the merger will mean fewer beds and that Sotiria was the foremost specialized lung hospital in the capital, treating patients from all over the south of Greece.
Hospital workers have also said that they have not been paid emergency duty wages for the past four months, and are protesting horizontal pay cuts across the Greek public sector.