BRUSSELS (MNI) – Greece’s Prime Minister Lucas Papademos said
Friday that based on the information he had so far, the participation of
private sector creditors in the country’s debt swap and reduction
proposal (PSI) “is significant.”

However, Papademos refrained from providing a specific percentage
figure. Greece is aiming for a target of 90% participation, though it
may decide to go ahead with the deal if participation is at least 75%.

Beneath that level, the government in Athens has the option of
activating collective active clauses (CACs), which would force
recalcitrant bondholders to sign onto the deal, but could trigger
payment of CDS on Greek bonds.

Speaking at a press conference here in Brussels after the end of
the EU leaders’ summit, Papademos was asked to comment on whether there
was a “Plan B” for Greece in case the PSI deal falls through.

“The participation of the private sector will be adequate. I don’t
think I can add anything further to this today,” he replied. “If the
contrary is proven, then we will act accordingly. But this is a case
study and there is no point in discussing today any alternative plans.”

On Thursday night, Eurogroup president Jean-Claude Juncker told
reporters that there “was a plan B” in case the PSI falls short, but he
did not reveal any specifics. Today, French president Nicolas Sarkozy
said he was unaware of such a plan.

Papademos echoed the comment of Greek Finance Minister Evangelos
Venizelos, who said that the “PSI is a very attractive offer for
investors.”

The Greek prime minister said he expected the PSI procedure to be
concluded by March 9, and the new lending agreement with Greece’s
official sector creditors to be signed by March 14. Asked to comment on
whether his coalition government should be seeking to extend its
mandate, Papademos replied: “After the government concludes its work, we
will discuss the election date.”

Greece is widely expected to hold a national election next month,
but one has not been officially called.

–Brussels newsroom, a_papamiltiadou@hotmail.com

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