Finally, the Greek State and the National Βank was discharged by the famous Titlos, according to the decision of the Deputy Finance Minister, George Houliarakis, which was published in the Government Gazette on February 15. This is the… sinful swap that the Greek State had made with Goldman Sachs in 2001 (during Simitis government). It is worth mentioning that this was considered a symbol of falsification of fiscal data, so that Greece could join the eurozone!
In 2008, Goldman Sachs wanted to discharge its portfolio from such derivatives and it was bought it by National Bank. By Houliarakis decision, the State Debt Agency canceled the swap, which amounted to a written-down value of 4.03 billion euros, and in return gave to the National Bank three bonds with a nominal value of 3.31 billion euros. With the cancellation, the Greek State achieves a debt reduction of 724 million euros, that is the difference between the written-down value of Titlos and the nominal value of the three bonds it gave in return to the bank.
But the National Bank also benefits as it gains from the bonds maturing in 2023, 2025 and 2026 an annual interest income of € 110 million.
In the years of the crisis, Titlos was downgraded by rating agencies, supported by a swap that was dependent on Greek government payments, and therefore reflected the assessment of the Greek debt, which was extremely low between 2011 and 2015.
The National Bank on 1 December 2017 proceeded with the cancellation of the Titlos plc securitization with effect on the same date to cancel the bond issued by the Titlos plc under this securitization and the relative requirement to return to the previous state.
It must be noted that the Hellenic Republic paid an interest rate equal to the six-month Euribor plus 660 basis points (6,6025%) for the interest rate swap transaction and the National Bank received an annual fixed rate of 4,5%./IBNA