Greece, S&P: restructuring means selective default

It seems increasingly difficult to find a solution to the Greek crisis capable of satisfying the demands of the rating agencies. Standard and Poor's said today that France's plan to roll over maturing Greek debt could result in a selective default. France presented two proposals for a soft debt restructuring involving private individuals in bailing out Greece.
The first provides for the reinvestment of 90% of the funds received from Athens, upon maturity of the bonds currently in force, in newly issued 5,5-year bonds (fixed coupon of XNUMX%).
The second would reinvest only 70% of these funds. Of these, 50% would be allocated to the purchase of new 30-year bonds (with a fixed coupon of 5,5% plus a premium indexed to the growth of the Greek economy). While the remaining 20% ​​would be placed in a bond fund with very safe securities which would act as a guarantee against a possible default.
According to S&P's criteria "each of the two funding options proposed by the Federation Bancaire Francaise (FBF) would lead to a default". This is what can be read in today's note from the rating agency. The restructuring would offer creditors less value than the promise of the original bonds, putting the country in default. Should Greece opt for such a restructuring, "we would likely downgrade the country's rating to 'SD', indicating that it has effectively restructured some, but not all, of its debt," the agency said. The judgment on Greece is, from the downgrade of 13 June, to "CCC", four steps away from the value "SD" which indicates the selective default.
If S&P continues to define itself as skeptical about Athens' ability to honor the commitments made with the Monetary Fund and the European Union and the president of the Eurogroup, Jean-Claude Juncker, has declared himself confident in the austerity plan approved by the Greek parliament and in the weekend the go-ahead was given for the fifth tranche of aid worth 12 billion euros which will be disbursed on 15 July.
The fact remains that the markets trust rating agencies more than Juncker. After the S&P's statement, the euro fell to the lows of the session at 1,4518 dollars from the previous close of 1,4540. At 11.15 it recovered and grew by 0,05%.