Greek FinMin, Yiannis Stornaras admitted in a television interview (www.skai.gr) that sealing an agreement with the troika by the end of January is rather challenging but suggested that Greece considers the delay favourable since it will be able to incorporate the positive December data.
According to Kathimerini, the negotiations are likely to conclude in February and the agreement framework is likely to include several prior actions/milestones attached to the release of financial support. In effect, the next disbursements (Q4’13 and Q1’14 totaling more than EUR8bn) will be split in several sub-tranches that will be disbursed to Greece after the conditions have been met and without the need of the troika mission to return to Greece. Kathimerini suggests this may be part of the EU’s attempt to give Greece breathing space so as to keep the markets calm in the run up to the EU Parliament elections in May.
According to press reports the submission of a draft bill altering the current bank recap framework and possibly expediting the banks’ reprivatization may be delayed.
In particular, the Minister stated that the banks’ capital requirements will be determined by the Bank Of Greece report that will also incorporate the recent Blackrock asset quality review and that any equity offerings will be priced according to market practices regardless of the HFSF’s cost base. The delay according to press may be attributed to the recent judicial affairs concerning Hellenic Postbank and delays in the troika mission arrival in Greece.
Source: Eurobank Equities