EU regulators ordered Greece to disclose details swap agreements

(Bloomberg):


European Union regulators ordered Greece to disclose details of currency swaps after an inquiry by the country’s Finance Ministry uncovered a series of agreements with banks that it may have used to conceal mounting debts.


The swaps were employed to defer interest payments by several years, according to a Feb. 1 report commissioned by the Finance Ministry in Athens. The document didn’t identify the securities firms that arranged the contracts. The government turned to Goldman Sachs Group Inc. in 2002 to get $1 billion through a swap, Christoforos Sardelis, head of Greece’s Public Debt Management Agency from 1999 to 2004, said in an interview last week.


“While swaps should be strictly limited to those that lead to a permanent reduction in interest spending, some of these agreements have been made to move interest from the present year to the future, with long-term damage to the Greek state,” the Finance Ministry report said. The 106-page dossier is now being examined by lawmakers.