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Greece’s slow reforms may delay return of bond profits – sources

Papadimas Lefteris, (2018), “Greece’s slow reforms may delay return of bond profits – sources”Reuters, 20 November

Athens, Nov 20 (Reuters) – Greece is at risk of missing a first tranche of ECB profit returns on Greek bond holdings due to delays in the pace of privatisations despite over-performance on its fiscal targets, sources told Reuters on Tuesday.

About 4.8 billion euros ($5.48 billion) of profits from Greek bonds held by the ECB and other eurozone central banks are supposed to be channelled back to Athens by June, 2022 in semi-annual tranches, as agreed with Greece’s lenders under a post bailout agreement.

Greece concluded its third bailout in August but agreed to continue structural reforms under scrutiny from the European Commission.

Linking the so-called ANFA and SMP profit returns to Greece’s post bailout performance was seen as an incentive for Athens to remain committed on hard-won reforms adopted under three bailouts worth more than 280 billion euros.

The first 600 million-euro payment from the ANFA and SMP incomes was expected in December this year.

“The (European) Commission in its enhanced surveillance report that will be published in the coming days will refer negatively to the country’s performance on reforms such as privatisations,” a source said.

“That might delay the first payment of ANFA and SMP profits by a few months,” the source said, adding that there are also delays in state arrears payments to suppliers.

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