The guy who may have crushed Greece's hopes for a slow and steady bond issuance strategy by rushing head over heels to raise as much as his underwriters promised him could be done, with the result being getting hit on just 39% of the €1 billion in the recent 12 year reopening, is former Goldman banker Petros Christodoulou, director of the Greek Public Debt Management office. Here he is an a Bloomberg TV interview conducted earlier, during which he answers such questions as:
1. How much debt do you need to raise in May (now that April is allegedly done)?
P.C. $11.6 billion needed in May (and April is contingent on several sucessful T-Bill auctions which one should most certainly not take for granted).
2. Will you raise dollar denominated debt?
P.C. Roadshow for global dollar denominate debt deal will take place in end of April, early May.
3. What do you consider a reasonable spread for Greek debt?
P.C. I would expect toward the end of the summer to see the current spread of 300 down to 250, and later to 200. [If even with full EU and IMF backing this has not happened yet... good luck]
4. Are you disappointed by the 7 year trading below the break price?
P.C. The 7 year is not a popular sector (let's blame it on the investors). This is the best we could do. We need to give it time and things will stabilize. And, presto, it is the holiday week [yes, yes, Easter' fault]
5. So why did you decide to go ahead with the 12 year auction the next day?
P.C. The auction was not intended. It was a technical operation to take care of an abnormality in the market. Continuous fails at -10, -20 on the repo caused Primary Dealers to force us to issue it. [Good to know who calls the shots in Greece.]
6. What are total funding cost needs in Greece thru end of 2010?
P.C. $32 billion
7. And how will you entice investors?
P.C. Something about having 3rd longest average Treasury maturity in Europe. Not sure how this is relevant, seeing how the entire curve is going through the roof.
8. At what point would you go to EU and tap them for aid?
P.C. When we have no access to the market, which is not the case now. [Lehman deja vu]
9. Is there a change in the investor base of people who buy bonds?
P.C. Some banks have reduced limits on bank holdings, which courtesy of the bailout have been lifted, these limits should be lifted. Dealers should be more comfortable holding Greek debt.
10. Are you enjoying your job right now?
P.C. It is a challenge