Catharsis Ours: Greece and Troika playing stall ball .... If the ECB ...

Meanwhile, ECB executive board member Joerg Asmussen dealt another blow to Greek hopes of rolling over the bonds held by the central lender. ?We can neither extend the maturities for Greek bonds nor lower the interest rates,? he told Bild newspaper. ?Both would be a form of debt relief and so direct financing of the Greek state, which the ECB is not legally allowed to do.?

and Greece forms its version of a TBTF bank....

Eurobank and NBG to form banking giant ?Deal will merge assets of 178 billion National Bank of Greece announced late on Friday its board?s decision to proceed to a full merger with domestic rival Eurobank Ergasias for the creation of a dominant force in the local market that would be able to survive the challenges of a prolonged recession. The mega-merger planned is set to create a national champion in the industry with combined assets of at least 177.7 billion euros, approaching the country?s gross domestic product. Its loan portfolio will amount to some 110 billion euros and deposits will add up to 90 billion. It will have a total of 1,845 branches abroad and 952 in Greece. ?With this proposal, National Bank is speeding up the merger trend in the Greek banking system, creating a credit institution that will be sustainable in the long term and able to respond to the challenges Greece is going through,? stated NBG?s chief executive, Alexandros Tourkolias. In the board meetings held separately at the two banks on Friday it was agreed that the merger process will begin with a share exchange near the current stock prices of the lenders, on a three-to-one ratio, to be followed by an acquisition proposal by National to Eurobank. A press report in the morning had triggered rumors about a merger deal, forcing the Capital Market Commission to suspend trading in the stocks of the two banks for the rest of the day at the Athens bourse. After French group Credit Agricole?s decision to pick Alpha Bank as its preferred buyer for the sale of Greek subsidiary Emporiki Bank, announced on Monday, the other two suitors, National and Eurobank, apparently decided to forge an alliance of some sort that is now set to lead not just to a merger between them but could also include the industry?s other prized asset, Hellenic Postbank (TT). Reports in the Greek media have suggested that NBG and Eurobank have been eyeing TT after failing to land Emporiki, but given that both have small stakes in the state-owned lender, it is near certain that once the two banks merge, they will also buy out TT to create a banking giant that will be healthy enough to require no more than a small amount of extra capital from the recapitalization process. and we shall see how this plays out - Samaras says Greece officially hits the wall by the end of November.... ?Greek prime minister Antonis Samaras hit?dramatic tunes about?the state finances and the social?situation of the country. Speaking to German daily Handelsblatt, Samaras stressed the necessity of the 31-billion-euro bailout tranche saying that?Greece has money until the end of November. ?Then the cash box is empty,? Samaras said. ?Antonis Samaras told a German paper in an interview published on Friday his country could not manage beyond November without the next tranche of international aid and suggested the ECB could help by easing the terms of its Greek debt holdings. ?The key is liquidity. That is why the next credit tranche is so important for us,? Samaras told the business daily Handelsblatt. Asked how long Greece could manage without it, he said: ?Until the end of November. Then the cash box is empty.? The European Central Bank could help by accepting lower interest rates on its existing Greek debt holdings ?or it could approve a rollover when these bonds mature?, he said. ?I could also imagine the recapitalization of Greek banks as is being considered for Spain, which would be not accounted for on its state debts but carried out directly via the ESM. That would be a significant relief,? said Samaras.? (Reuters) As for the political and social situation in Greece, Samaras?warned of the high unemployment and the rise of neo fascist Chrysi Avgi (Golden Dawn) as ?destabilizing?factors. Samaras described Golden Dawn as ?extreme-right, one could say fascist, neo-Nazi party.? ?Greek democracy is perhaps facing its biggest challenge,? he said and warned that if? the coalition government fails in its task, ?chaos awaits? the country, the Greek PM said. ?The cohesion of society is at risk, should the reforms fail.? ?Due to austerity measures and the dire economic situation, the Greeks ?lost more than one third of their living standards within five years, Samaras told Handelsblatt, adding: ?German Chancellor Angela Merkel?hit the right tune, when she mentioned that her heart bleeds in the face of such hardships,? Samaras said and spoke out an unofficial invitation to Merkel to visit?Athens: ?She is welcome anytime.?

Source: http://fredw-catharsisours.blogspot.com/2012/10/greece-and-troika-playing-stall-ball-if.html

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