Greece, IMF expect debt deals soon

Page last updated at 05:57 GMT, Wednesday, February 1, 2012 - 10:57 EST

Associated Press:

A homeless man sleeps on a bench outside the municipal culture center of Athens ...

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Greece and the IMF said Wednesday that negotiations for landmark debt deals will be concluded in a "matter of days," raising hopes that the country will dodge a disastrous default in the spring.

Greece is in talks with private creditors to have them take losses on their bondholdings and with its international bailout rescuers to receive new loans.

"We are at a crucial point in developments. In the coming days, the agreements must be completed" for the bond swap and a second €130 billion $171 billion) bailout package, government spokesman Pantelis Kapsis said.

Debt inspectors from the European Commission, European Central Bank and the International Monetary Fund, known as the troika, are in Athens for talks on the second rescue package, which is tied to an agreement with private creditors to accept losses on Greek bonds they hold.

The bond swap, known as the Private Sector Involvement, or PSI, will see private creditors swap the bonds they hold with new ones worth half their original face value, longer repayment times and lower interest rates. They will also get a cash sweetener for accepting the deal, which will cut €100 billion off Greece's national debt.

Read the whole story: Associated Press