A more than doubly oversubscribed book is nothing to be sniffed at, the pricing looked fair and thanks to the addition of a switch offer the issuer has shunted €1.5bn from its 2019 funding needs to three years down the line — at a cost of €39m, based on the price at which the sovereign offered to buy the outstanding bonds.
The book was of course far smaller than its comeback bond in April 2014, but hopefully there will be a bit less fast money in there — and, more importantly, Greece looks on a much stronger footing than back then.
There were some murmurs over timing: one could argue that the Syriza government, behind in the polls, is keen to ensure it has full market access so as to leave its assistance programme as scheduled in August 2018.
Maybe waiting would have brought in more demand, but the issuer made sure that all and sundry were well prepared for the trade — hopefully meaning that the most important accounts had put off their summer holidays for a few weeks.
Of course, as GlobalCapital and many others have pointed out repeatedly in the past, market access is one thing, but what Greece really needs is serious action on its towering debt pile.
That means that, more important than this week’s bond issue, was last Friday’s decision by the IMF to approve in principle a €1.6bn equivalent precautionary stand-by agreement for the sovereign.
But that support — to help alleviate any short term balance of payment needs — is less important again than the caveat the IMF included: that it will only become effective “after the Fund receives specific and credible assurances from Greece’s European partners to ensure debt sustainability, and provided that Greece’s economic program remains on track”.
As IMF managing director Christine Lagarde said in a statement accompanying the decision: “Greece will not be able to restore debt sustainability and needs further debt relief from its European partners.”
No bond issue, no matter how well subscribed, priced or timed, will change that fact.