Athens - AFP
The head of the Institute of International Finance, a global association of top financial institutions, said that talks on a writedown of Greek debt held by banks were making slow progress. "Discussions are making progress, albeit limited," IIF president Charles Dallara, who was in Brussels for crisis talks with the European Union, said in a statement. "We remain open to explore options on a voluntary approach built on a realistic outlook for the Greek economy and restoration of Greece?s market access." French President Nicolas Sarkozy and German Chancellor Angela Merkel both said "progress" had been made in efforts to contain the eurozone debt crisis, with an eye towards a definitive solution that must be approved Wednesday. One of the many issues up for discussion is the writedown of Greek debt, or the amount that the country's creditor banks are willing to accept as losses. Europe and the IMF would only proceed with a second planned Greek bailout of 109 billion euros ($151 billion) if banks accepted losses of "at least 50 percent" on their debt holdings, diplomats said. Banks had agreed to accept losses of 21 percent of their holdings in July. Many Italian and Spanish banks, like the French, have seen their credit rating downgraded in recent weeks as fears rise over their exposure to sovereign debt. One negotiator told AFP that the talks with the banking sector were going rather well and that governments were "confident" that a deal could be sealed. The eurozone countries are racing to settle an all-encompassing deal before the world's top economies meet at a G20 summit in Cannes on November 3-4.