Moody's Says Greek Debt Rollover Would Be a Default

Wall Street Journal
June 7, 2011

Any private-sector debt rollover as part of an agreement to provide financing to Greece would likely be considered a default by Moody's Investors Service, a senior executive said Tuesday, arguing it was hard to say how a rollover could be deemed voluntary.

"If it's voluntary, then it falls outside the default definition," said Bart Oosterveld, head of the sovereign-risk group at Moody's. But he said: "It's hard to imagine in the current circumstances how it could be voluntary."

Speaking to reporters in Paris, Mr. Oosterveld said such a rollover "would likely constitute a credit event."

His comments come as policy makers seek to come up with a plan to ease Greece's cash crunch. France, continuing its objection to any Greek bailout plan that is considered a default, is pushing a proposal in which holders of Greek debt would roll it over into new bonds when it matures, senior French officials say. The officials argue that such a plan would be voluntary and likely not be considered a default.

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