According to BI: One of the aspects of the Cyprus bank bailout deal hatched
by the EU and the Cypriot government in March that has been noted as a big
positive by analysts across Wall Street is the fact that it won't hurt the
sovereign's creditworthiness in the same way it would if deposits weren't used
to fund the bailout.
Restructuring experts Lee Buchheit of Cleary Gottlieb and
Mitu Gulati of Duke Law School put it this way: Cypriot sovereign bonds will
emerge unscathed. The next bond maturing
on June 3, 2013 in the amount of €1.4 billion – a large chunk of which is
reputed to have been bought by international hedge funds over the last six
months at prices ranging from 70-75 cents on the euro – will be paid out at 100
cents on the euro in about ten weeks.
Hedge funds luck out in this case. They own "around
half" of the June 2013 bonds, according to IFR reporters Natalie Harris
and John Geddie...
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