Greek pension funds turned down on Thursday an offer by investment bank J.P. Morgan to buy back a Greek government structured bond at the heart of a scandal rocking the government. A source at the bank told Reuters its proposal was rejected and was now off the table while funds said the deal did not cover interest they would have earned otherwise.
"We counter-proposed to be compensated for foregone interest had the money been placed with the central bank but this was not accepted so the deal is off," said George Kotzamanoglou, a board member at TEAPOKA, which handles public sectors workers' pension funds.
Last month, J.P. Morgan and London-based brokerage North Asset Management agreed to buy back the structured Greek government paper, which ministers have said was sold to pension funds at a high price, prompting an investigation by the prosecutor.