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UPDATE 2-Deutsche Bank CEO in Athens for Greek govt talks
Fri, 26th Feb 2010 14:04
FRANKFURT, Feb 26 (Reuters) - Deutsche Bank Chief Executive Josef Ackermann met Greek government officials in Athens on Friday as the embattled country tries to resolve a financing crisis which could threaten the euro's stability.
Ackermann met with Greek Prime Minister George Papandreou and Finance Minister George Papaconstantinou on Friday in what Deutsche Bank described as a 'normal business visit'.
Deutsche Bank, Germany's flagship lender which helped manage the Greek government's latest bond issuance, declined to elaborate about the nature of the talks.
Greece is preparing for its second bond issue this year, possibly in early March, to raise about 20 billion euros ($26.95 billion) to cover maturing debt in April and May.
Advising Greece on finance is a thorny issue, however, after Goldman Sachs drew fire for helping Athens arrange derivatives deals that critics say were used to disguise the size of its budget deficits.
German banks, the third-biggest creditors of Greece after peers in France and Switzerland, are reluctant to add to their exposure to Greece at a time when the Mediterranean country is desperate to shore up its finances.
Eurohypo, a unit of Commerzbank, said it will not be adding to its 3.1 billion euro exposure to Greece.
Rival Hypo Real Estate, which was nationalised in October, has been shrinking its balance sheet to refocus on a no-frills refinancing business for public sector and commercial property projects based on covered bonds, so is not looking to Greece.
'We are pursuing a client-oriented strategy in public sector finance with a focus on core markets Germany, France, Spain and Italy,' a spokesman said on Friday.
Hypo Real Estate Group, which since its nationalisation has been operating under the Deutsche Pfandbriefbank AG brand, has exposure of below 10 billion euros to Greece.
A spokesman for Deutsche Postbank said on Friday the Bonn-based lender would not add to its nearly 1.3 billion euro Greek government bond exposure.
Deutsche Bank had earlier said it was not part of its core business to invest in government bonds of any kind. 'This has not changed,' a spokesman said.
At the bank's earnings conference this month, Ackermannn said Deutsche Bank had no significant exposure to Greece.
Big state-controlled landesbanks such as BayernLB and Landesbank Baden-Wuerttemberg are hardly likely to put money into Greek government bonds now, sources close to the situation said, but the banks declined comment.
Greece is the first country in 11 years of European monetary union to require a political pledge of support
as fears over its debt spark a market attack that has dented the euro and lifted Greek bond yields, making debt service even dearer.
Markets also have other euro zone countries such as Spain and Portugal in their sights.
The possibility of contagion -- the Greek crisis spreading to other euro zone states -- is a risk for Germany, whose banks have exposure to these countries, as is the impact the turmoil could have on business confidence.
Greece's crisis, exacerbated by ratings agency downgrades and market concerns over its solvency, is allowing Germany to press its case for more fiscal discipline in the euro zone, which it has championed from the outset of the project.
Greek Prime Minister George Papandreou will pay an official visit to Germany on March 5 at the invitation of Chancellor Angela Merkel.
(Reporting by Philipp Halstrick; Edward Taylor, Alexander Huebner, Patricia Uhlig and Marilyn Gerlach in Frankfurt, Matthias Inverardi in Duesseldorf and Christian Kraemer in Munich; Editing by Sharon Lindores)
($1=.7421 Euro) Keywords: GERMANY/GREECE Keywords: GERMANY/GREECE
(Reuters Messaging: marilyn.gerlach.reuters.com@reuters.net; 00 49 69 7565 1279)
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Copyright Thomson Reuters 2010. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
Ackermann met with Greek Prime Minister George Papandreou and Finance Minister George Papaconstantinou on Friday in what Deutsche Bank described as a 'normal business visit'.
Deutsche Bank, Germany's flagship lender which helped manage the Greek government's latest bond issuance, declined to elaborate about the nature of the talks.
Greece is preparing for its second bond issue this year, possibly in early March, to raise about 20 billion euros ($26.95 billion) to cover maturing debt in April and May.
Advising Greece on finance is a thorny issue, however, after Goldman Sachs drew fire for helping Athens arrange derivatives deals that critics say were used to disguise the size of its budget deficits.
German banks, the third-biggest creditors of Greece after peers in France and Switzerland, are reluctant to add to their exposure to Greece at a time when the Mediterranean country is desperate to shore up its finances.
Eurohypo, a unit of Commerzbank, said it will not be adding to its 3.1 billion euro exposure to Greece.
Rival Hypo Real Estate, which was nationalised in October, has been shrinking its balance sheet to refocus on a no-frills refinancing business for public sector and commercial property projects based on covered bonds, so is not looking to Greece.
'We are pursuing a client-oriented strategy in public sector finance with a focus on core markets Germany, France, Spain and Italy,' a spokesman said on Friday.
Hypo Real Estate Group, which since its nationalisation has been operating under the Deutsche Pfandbriefbank AG brand, has exposure of below 10 billion euros to Greece.
A spokesman for Deutsche Postbank said on Friday the Bonn-based lender would not add to its nearly 1.3 billion euro Greek government bond exposure.
Deutsche Bank had earlier said it was not part of its core business to invest in government bonds of any kind. 'This has not changed,' a spokesman said.
At the bank's earnings conference this month, Ackermannn said Deutsche Bank had no significant exposure to Greece.
Big state-controlled landesbanks such as BayernLB and Landesbank Baden-Wuerttemberg are hardly likely to put money into Greek government bonds now, sources close to the situation said, but the banks declined comment.
Greece is the first country in 11 years of European monetary union to require a political pledge of support
Markets also have other euro zone countries such as Spain and Portugal in their sights.
The possibility of contagion -- the Greek crisis spreading to other euro zone states -- is a risk for Germany, whose banks have exposure to these countries, as is the impact the turmoil could have on business confidence.
Greece's crisis, exacerbated by ratings agency downgrades and market concerns over its solvency, is allowing Germany to press its case for more fiscal discipline in the euro zone, which it has championed from the outset of the project.
Greek Prime Minister George Papandreou will pay an official visit to Germany on March 5 at the invitation of Chancellor Angela Merkel.
(Reporting by Philipp Halstrick; Edward Taylor, Alexander Huebner, Patricia Uhlig and Marilyn Gerlach in Frankfurt, Matthias Inverardi in Duesseldorf and Christian Kraemer in Munich; Editing by Sharon Lindores)
($1=.7421 Euro) Keywords: GERMANY/GREECE Keywords: GERMANY/GREECE
(Reuters Messaging: marilyn.gerlach.reuters.com@reuters.net; 00 49 69 7565 1279)
COPYRIGHT
Copyright Thomson Reuters 2010. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
