希腊当年为达到加入欧元区标准与高盛的秘密贷款
2012-03-07 00:22阅读：1,574
Goldman’s Secret Greece Loan Reveals Sinners
By Nicholas Dunbar and Elisa Martinuzzi - Mar 6, 2012 8:01 AM
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Greece’s secret loan from Goldman Sachs Group Inc. (GS) was a
costly mistake from the start.
On the day the 2001 deal was struck, the government owed the bank
about 600 million euros ($793 million) more than the 2.8 billion
euros it borrowed, said Spyros Papanicolaou, who took over the
country’s debt-management agency in 2005. By then, the price of the
transaction, a derivative that disguised the loan and that Goldman
Sachs persuaded Greece not to test with competitors, had almost
doubled to 5.1 billion euros, he said.
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The Acropolis, Athens. Photographer: Petros Giannakouris/AP
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March 6 (Bloomberg) -- Greece's secret loan from Goldman Sachs
Group Inc. was a costly mistake from the start.
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Olivia Sterns reports on Bloomberg Television's 'Countdown' with
Owen Thomas and Linzie Janis. (Source: Bloomberg)
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A European Union (EU) flag, left, and Greek national flag fly near
the Parthenon temple on Acropolis hill in Athens, Greece.
Photographer: Simon Dawson/Bloomberg
Papanicolaou and his predecessor, Christoforos Sardelis, revealing
details for the first time of a contract that helped Greece mask
its growing sovereign debt to meet European Union requirements,
said the country didn’t understand what it was buying and was
ill-equipped to judge the risks or costs.
“The Goldman Sachs deal is a very sexy story between two sinners,”
Sardelis, who oversaw the swap as head of Greece’s Public Debt
Management Agency from 1999 through 2004, said in an
interview.
Goldman Sachs’s instant gain on the transaction illustrates the
dangers to clients who engage in complex, tailored trades that lack
comparable market prices and whose fees aren’t disclosed. Harvard
University, Alabama’s Jefferson County and the German city of
Pforzheim all have found themselves on the losing end of the
one-of-a-kind private deals typically pitched to them by securities
firms as means to improve their finances.
Goldman Sachs DNA
“Like the municipalities, Greece is just another example of a
poorly governed client that got taken apart,” Satyajit Das, a risk
consultant and author of “Extreme Money: Masters of the Universe
and the Cult of Risk,” said in a phone interview. “These trades are
structured not to be unwound, and Goldman is ruthless about
ensuring that its interests aren’t compromised -- it’s part of the
DNA of that organization.”
A gain of 600 million euros represents about 12 percent of the
$6.35 billion in revenue Goldman Sachs reported for trading and
principal investments in 2001, a business segment that includes the
bank’s fixed-income, currencies and commodities division, which
arranged the trade and posted record sales that year. The unit,
then run by Lloyd C. Blankfein, 57, now the New York-based bank’s
chairman and chief executive officer, also went on to post record
quarterly revenue the following year.
‘Extremely Profitable’
The Goldman Sachs transaction swapped debt issued by Greece in
dollars and yen for euros using an historical exchange rate, a
mechanism that implied a reduction in debt, Sardelis said. It also
used an off-market interest-rate swap to repay the loan. Those
swaps allow counterparties to exchange two forms of interest
payment, such as fixed or floating rates, referenced to a notional
amount of debt.
The trading costs on the swap rose because the deal had a notional
value of more than 15 billion euros, more than the amount of the
loan itself, said a former Greek official with knowledge of the
transaction who asked not to be identified because the pricing was
private. The size and complexity of the deal meant that Goldman
Sachs charged proportionately higher trading fees than for deals of
a more standard size and structure, he said.
“It looks like an extremely profitable transaction for Goldman,”
said Saul Haydon Rowe, a partner in Devon Capital LLP, a
London-based firm that advises global investors on derivatives
disputes.
Disappearing Debt
Goldman Sachs declined to comment about how much it made on the
swaps. Fiona Laffan, a spokeswoman for the firm in London, said the
agreements were executed in accordance with guidelines provided by
Eurostat, the EU’s statistical agency.
“Greece actually executed the swap transactions to reduce its
debt-to-gross-domestic-product ratio because all member states were
required by the Maastricht Treaty to show an improvement in their
public finances,” Laffan said in an e- mail. “The swaps were one of
several techniques that many European governments used to meet the
terms of the treaty.”
Cross-currency swaps are contracts borrowers use to convert foreign
currency debt into a domestic-currency obligation using the market
exchange rate. As first reported in 2003, Goldman Sachs used a
fictitious, historical exchange rate in the swaps to make about 2
percent of Greece’s debt disappear from its national accounts. To
repay the 2.8 billion euros it borrowed from the bank, Greece
entered into a separate swap contract tied to interest-rate
swings.
Falling bond yields caused that bet to sour, and tweaks to the deal
failed to prevent the debt from almost doubling in size by the time
the swap was restructured in August 2005.
Greece, which last month secured a second, 130 billion-euro
bailout, is sitting on debt equal to about 160 percent of its GDP
as of last year.
Eurostat Rules
Under Eurostat accounting rules, nations were permitted until 2008
to use so-called off-market rates in swaps to manage their debt.
Greek officials, including Sardelis, say they learned that other EU
countries such as Italy had employed similar methods to shrink
their debts, taking advantage of the secrecy of over-the-counter
derivatives compared with swaps traded on exchanges.
Eurostat said Greece didn’t report the Goldman Sachs transactions
in 2008 when the agency told countries to restate their
accounts.
“The Greek authorities had never informed Eurostat about this
complex issue and no opinion on the accounting treatment had been
requested,” the Luxembourg-based agency said in a statement last
month.
Eurostat said it had only “general” discussions with financial
institutions on its debt and deficit guidelines when the swap was
executed in 2001. “It is possible that Goldman Sachs asked us for
general clarifications,” Eurostat said, declining to
elaborate.
Loudiadis Role
Bloomberg News filed a lawsuit at the EU’s General Court seeking
disclosure of European Central Bank documents on Greece’s use of
derivatives to hide loans. Releasing such information could damage
the commercial interests of the ECB’s counterparties, hurt banks
and markets, and undermine the economic policy of Greece and the
EU, the central bank said last May in a response to the suit. A
judgment is pending.
Sardelis, 61, and Papanicolaou, 72, said several banks, including
Goldman Sachs, made proposals to manage Greece’s debt. The bank was
represented by its top European sales executive at the time, Addy
Loudiadis. She was trusted, said Papanicolaou, because she had
helped price competitors’ derivatives and in 1999 warned the Greeks
against buying a complex swap.
Sardelis, a former bank economist, described Loudiadis, who’s based
in London, as “very professional -- a little bit aggressive as is
everyone at Goldman Sachs.”
‘Teaser Rate’
The derivative Loudiadis offered Sardelis in 2001 was also complex.
Designed to provide a cheap way to repay 2.8 billion euros, the
swap had a “teaser rate,” or a three-year grace period, after which
Greece would have 15 years to repay Goldman Sachs, Sardelis said.
All in, the deal appeared cheap to officials at the time, he
said.
“We calculated that this had an extra cost above our normal funding
cost on the yield curve of 15 basis points,” Sardelis said. A basis
point is 0.01 percentage point.
Loudiadis, now CEO of Rothesay Life, a Goldman Sachs unit that
insures longevity risk for U.K. corporate pension plans, declined
to comment, a company spokeswoman said.
‘Very Bad Bet’
Sardelis said he realized three months after the deal was signed
that it was more complex than he appreciated. After the Sept. 11,
2001, attacks on the U.S., bond yields plunged as stock markets
sold off worldwide. That caused a mark-to-market loss on the swap
for Greece because of the formula used by Goldman Sachs to compute
Greece’s repayments over time.
“If you calculated that when we did it, it looked very nice because
the yield curve had a certain shape,” Sardelis said. “But after
Sept. 11, we realized this would be the wrong formula. So after we
discussed it with Goldman Sachs, we decided to change to a simpler
formula.”
The revised deal proposed by the bank and executed in 2002, was to
base repayments on what was then a new kind of derivative -- an
inflation swap linked to the euro-area harmonized index of consumer
prices. An inflation swap is a financial bet that pays off
according to the degree to which a consumer-price index exceeds or
falls short of a pre-specified level at maturity.
That didn’t work out well for Greece either. Bond yields fell,
pushing the government’s losses to 5.1 billion euros, according to
an analysis commissioned by Papanicolaou. It was “a very bad bet,”
he said in an interview.
“This is even more reprehensible,” Papanicolaou said of the revised
deal. “Goldman asked them to make a change that actually made
things even worse because they went into an inflation swap.”
Confidentiality Requirement
Greece was handicapped, in part, by the terms Goldman Sachs
imposed, he said.
“Sardelis couldn’t actually do what every debt manager should do
when offered something, which is go to the market to check the
price,” said Papanicolaou, who retired in 2010. “He didn’t do that
because he was told by Goldman that if he did that, the deal is
off.”
Sardelis declined to comment about the analysis, as did Petros
Christodoulou, director general of the debt-management agency since
February 2010.
It isn’t unusual for dealers to impose confidentiality requirements
on clients in complex transactions to prevent traders from using
the information to front-run or trade against the bank arranging
and hedging the deal, said a former official who analyzed the swap
and asked not to be named because the details are private.
‘Large Number’
Goldman Sachs’s initial 600 million-euro gross profit “sounds like
a large number, but you have to take into account what the bank
will be setting aside as a credit reserve, the cost to Goldman to
fund the loan and the cost of hedging the currency component,” said
Peter Shapiro, managing director of Swap Financial Group LLC in
South Orange, New Jersey, an independent swaps adviser. “It’s hard
to tell what the profit margin would have been.”
The report Papanicolaou commissioned after taking over the agency
showed the repayment formula meant that Greece would have to pay
Goldman Sachs 400 million euros a year, he said. The coupon and the
mark-to-market swings on the swap prompted George Alogoskoufis,
then finance minister, to decide to restructure the deal again to
limit losses, Papanicolaou said.
Loudiadis and a team of Goldman Sachs advisers returned to Athens
in August 2005, according to former Greek officials. The agreement
they reached to transfer the swap to National Bank of Greece SA and
extend the maturity to 2037 from 2019, gave the Greeks what they
wanted, Papanicolaou said.
‘Squeeze Taxpayers’
The 5.1 billion-euro mark-to-market value of the swap was “locked
in,” Papanicolaou said. It was that politically motivated decision
to restructure and fix the increased market value that did as much
damage as the original swap, said Sardelis, now a board member of
Ethniki General Insurance Co., a subsidiary of National Bank of
Greece.
“You can’t have prudent debt management if you change all the
assumptions all the time,” he said.
Gustavo Piga, a professor of economics at University of Rome Tor
Vergata and author of “Derivatives and Public Debt Management,”
sees a different lesson.
“In secret deals, intermediaries have the upper hand and use it to
squeeze taxpayers,” Piga said in an interview. “The bargaining
power is in investment banks’ hands.”
To contact the reporters on this story: Nicholas Dunbar in London
at ndunbar1@bloomberg.net; Elisa
Martinuzzi in Milan at emartinuzzi@bloomberg.net
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