Finland to Forge Collateral Deal IMF Can Accept

Finland will find a Greek collateral model that respects the priority creditor status of the International Monetary Fund and honors existing bondholder claims, Prime Minister Jyrki Katainen said.

“We have to find a solution that is suitable for everybody, for other European Union countries, for Finland and for other creditors,” he said at a press briefing in Helsinki yesterday.

Katainen is struggling to piece together a deal that satisfies Finnish voter demands for extra assurances their bailout contributions will be repaid as international opposition to such arrangements mounts. Europe’s failure to find a solution puts the “credibility of the euro area and each of its member states at stake,” European Union President Herman Van Rompuy said, after a meeting with Katainen in the Finnish capital yesterday.

“The task is not easy, but without solving all the challenges, we can’t achieve the final outcome,” Katainen said. “So now we’re working.”

Bloomberg

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