Investors hoping for billions of dollars in insurance compensation from an agreement to reduce the amount Greece owes its bondholders were left disappointed Thursday after a panel convened by a derivatives market organization turned down requests for a payout. Greece and its bondholders last week agreed on a debt swap that would reduce the face value of euro206 billion of their holdings in Greek debt by 53.5 percent. The panel, which had been convened by the International Swaps and Derivatives Association, had been asked by investors to rule whether the bond swap agreement constituted a so-called “credit event”. This would have meant that bondholders who hold credit-default swaps — complex financial products that act as insurance against default — would have been paid off. It was also asked to rule on a bond swap carried out between Greece and the European Central Bank ahead of the creditor swap. The ECB got new bonds that were not subject to the agreed writedown, sparing it any losses. The panel had been asked to rule whether private credit holders were less likely to see any money if the debt has trouble being repaid because the ECB was getting paid ahead of them. The committee, meeting in New York and London, ruled that the Greek bond deal was still being carried out and did not yet constitute a credit event — but that the question could come up again. Germany's finance minister, Wolfgang Schaeuble, said he was optimistic that his eurozone colleagues would release the money to Greece.
