Mandatory Greek 'rescheduling' would mean default: Moody's

(PARIS) - Any rescheduling of Greek debt would constitute a default only if it is imposed on private investors rather than strictly voluntary, a spokesman for credit ratings agency Moody's said Friday.

International backers of a second bailout plan for Greece are currently considering delaying debt repayments, possibly via a bond rollover, to ward off the threat of a sovereign default, while anxious not to spook investors.

Moody's will be considering carefully whether private bondholders will agree to "rollover" their loans, or maintain their exposures to Greek debt, and whether they are given a real choice in the matterer, the spokesman said in emailed comments to AFP.

"A Vienna-style initiative is assumed to be voluntary", he said, referring to a 2009 deal in which banks agreed to push back deadlines for repayments on loans to Romania.

"If we come to the conclusion that (Greek rescheduling) was imposed on creditors, then we will decide that it probably constitutes a default," he added.

Eurozone officials are trying to avoid a disastrous interpretation by investors that rescheduling would equate to default, which a decided which may radiate throoughout the eurozone.

Moody's competitor Standard & Poor's last week said that a "reprofiling" or a rescheduling of the debt was equivalent to a "soft" default because the debtor nation would pay less than under the original terms of the obligation.

Amadeu Altafaj, the spokesman for EU economic affairs commissioner Olli Rehn earlier this week said that the feasibility of a voluntary debt rescheduling or reprofiling hinged "of course on the condition, extremely important, that this would not create a credit event."

Greece is struggling under a debt mountain of 350 billion euros (about $500 billion), most of it held by banks.

A new rescue package is expected to amount to about 90 billion euros ($130 billion), following a 110-billion-euro package set up last year.

In an ideal world, according to diplomats, one third from Greek state sell-offs, one third from the private debt rescheduling and the remainder via loans by eurozone and IMF partners.