Greece sees ‘trial and error’ bond foray, full return in 2016

Greece’s first for¬ay into bond markets after a four-year ex¬clusion will be on a “trial and error” basis but the nation expects to fund itself unaided in 2016, its finance minister told Reuters on Wednes¬day.

Buoyed by bond yields at a four-year low and a long-awaited deal with EU/IMF lenders that has unlocked more aid, Ath¬ens says it could issue debt as early as within the next three months.

“Now it is the right time – after all the good news we’ve had – to enter markets,” Yannis Stour¬naras told Reuters at his office overlooking Greek parliament in the central Syntagma square.

“The mood has changed dramatically recently. Simply look at what happened at Eurogroup – everybody thinks that Greece now is out of the woods.”

The Eurogroup of fi¬nance ministers met in Athens this week, attract¬ing about 5,000 protesters who denounced the latest measures agreed with the European Union and the International Monetary Fund to try to make the economy more competi¬tive.

Greek officials have previously told Reuters the initial post-bailout bond issue will likely be for 2 billion euros (1.65 billion pounds) of five-year bonds by June, but Stournaras declined to comment on the sum, say¬ing only that the initial issuance would be “small”.

“It will be a trial and er¬ror process,” he said.

“What we need first of all is to smooth the yield curve and second, it is time to see how markets re¬act, because at some time in the future we have to enter markets complete¬ly and finance all of our needs through markets.”

A return now would be among the swiftest comebacks by a country from default, given Greece imposed losses on private bondholders in 2012.

Asked if Athens would consider a second issue later in the year, Stour¬naras said: “If we think that markets are suitable for any extra issuance we might attempt it but for the moment we consider it a trial and error process.”

There was “huge ap¬petite” from foreign inves¬tors for the issue, Stour¬naras said.