The decision to postpone – even temporarily – the issuance of the bond up to 500 million euros was a disgrace for GEK TERNA, an over-indebted company that along with loans and letters of guarantee has loaded 9.3 billion in risk onto banks
We will focus on three interconnected events…
1) The Stock Exchange in Greece fades even if there are flashes... the base scenario calls for a fall
The Greek Stock Exchange will be tested at 2,400 units at the 200-day Moving Averages; we do not see a downward break below 2,400 units for now.
Even an upgrade of Greece's outlook by Standard & Poor's would be mismatched
2) Today, October 23, the American agency Standard & Poor's will publish its evaluation for the Greek economy
There will be no credit rating upgrade—it will remain at BBB—but there is a possibility of upgrading the outlook from stable to positive, though such a decision would be mismatched amid a crisis in the bond markets. In any case, today, October 23, interest is focused on Moody's evaluation of France, which it will downgrade, and not on Greece and Standard & Poor's. It should be noted that while they speak of a net debt of 326 billion and a total debt of 357 billion, in reality, the actual public debt is 402 billion.
111 billion in bonds 203 billion in Support Mechanism loans 64.8 billion in repos intra-governmental borrowing Specifically, the increase in repos is proof that the state is becoming over-indebted to present an image better than reality; we are continuing the errors of the past.
Postponing the bond issue was a complete disgrace for GEK TERNA
Let us be realistic. The decision to postpone – even temporarily – the issuance of the bond up to 500 million euros was a disgrace for GEK TERNA, an over-indebted company that along with loans and letters of guarantee has loaded 9.3 billion in risk onto banks. It went to raise 500 million and received interest rates of up to 5.8%, which are considered unacceptable, so the issuance was postponed. The excuses that the climate in international markets suddenly deteriorated were laughable, as the crisis in the bond market has been here for weeks. They knew it before publishing the decision. Essentially, it was an excuse to mitigate the fiasco. It was a slap in the face to a company that has borrowed 10 to 12 times its EBITDA and is valued at 32 times earnings. The stock remains in the 4.6 billion zone purely due to market manipulation.
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