Greece had 13 off-market derivative contracts with Goldman Sachs, most of which swapped Japanese yen into euro in a 2001 transaction aimed at concealing the true size of the nation's debt, according to the European Union's statistics office.
The amount borrowed through the swaps was due to be repaid with an interest-rate swap that would have spread payments through 2019, Eurostat said in a report yesterday. In 2005, the maturity was extended to 2037, the report said. Restructuring the swaps spread the cost over a longer period, leading to an increase in liabilities and debt, Eurostat said.
Repeated revisions of Greece's figures, beginning in 2009, spurred a surge in borrowing costs that pushed the country to the brink of default and triggered a region-wide debt crisis.
The use of off-market swaps, which Greece hadn't previously disclosed as debt, let the country increase borrowings by €5.3bn, Eurostat said in November.
Eurostat said most issues surrounding the swaps were resolved in September, when Greece agreed to correct its debt figures. (Bloomberg)