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Greece extends debt swap deadline

Greek Prime Minister Lucas Papademos, left, speaks with the new Greek Finance Minister Philippos Sachinidis
Image caption The debt swap is part of Greece's continuing efforts to reduce its sovereign debts

Greece has extended the deadline for its latest debt swap plan for a second time.

The new deadline for bonds governed by foreign law is now 20 April, the Greek finance ministry said.

Meanwhile, holders of such debt worth 20.3bn euros (426.5bn; £16.7bn) have agreed to accept the terms of a bond swap to lower Greece's deficit.

Hedge funds have been resisting the swap, which forces them to take losses of up to 74% on their bonds.

'Vultures'

The extended deadline applies to those institutions - include so-called distressed debt "vulture" funds - that continue to hold out.

Their hope is that Greece will think the amount is so minor that it is not worth defaulting on and pay them the full amount - which may lead to legal challenges from those who have accepted losses.

Last month, Greece got backing to cut 107bn euros from Greece's total government debt, which was a key condition for it to get its second bailout.

In the end,holders of 85.8% of debt subject to Greek law - 152bn euros out of 177bn euros - and 69% of its international debt holders agreed in March to a debt swap.

The European Union and International Monetary Fund then agreed to the latest bailout worth 130bn euros.

The aim is to cut the Greek government's debt from 160% of GDP to a little over 120% of GDP by 2020.

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