Image by Third Way Eurozone officials will meet on Thursday for more talks on a second Greek bailout, after the eurozone debt crisis spread last week to heavily indebted Italy, the region's third-largest economy.
Policymakers are examining three broad options for securing the private sector's involvement in the second Greek bailout: an EU-funded Greek government buy-back of its own debt on the secondary market; a French plan for a voluntary roll over of maturing Greek debt; and a third option based on a bank tax to raise extra money to help Greece.
A document obtained by Reuters foresaw the two first options triggering at least a selective default ratings on Greek debt but said the third one was unlikely to result in a downgrade.
Rating agencies have played hard ball and have said most kinds of private sector participation in a Greek rescue plan would be perceived as coercive, thereby triggering a default rating.
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