Fitch rating agency: private sector involvement in Greece will put country's bonds in default

7/22/2011

LONDON — Fitch ratings agency says it will put a default rating on Greece's government bonds as a result of the eurozone's new plan to get banks to share the burden of helping the country.

The eurozone plan says banks will be asked to contribute billions to Greece by rolling over debt, swapping bonds or selling them back at low prices.

As expected, Fitch said Friday that because that would mean a loss for those banks, it will lower Greece's rating to "restricted rating." That rating could be lifted, however, as soon as Greece issues new bonds to the banks.

Those new bonds would be guaranteed by eurozone governments.