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JPMorgan's Big Fat Greek Bond Foible

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JPMorgan is going to testify to the Greek parliament tomorrow regarding the underwriting of a $364mm structured bond on behalf of the Greek government and sold to local pension funds. Last week the pension funds agreed to sell the bond back to JPMorgan at face value, to the tune of a 20m euro loss for JPM and a London-based hedge fund. The deal came after the Greek government agreed to cover the bond's interest payments, when the pension funds claimed that they were getting the shaft. For some reason, Mediterranean pension funds keep buying bonds at crap prices, which is something that the Greek government is looking into.
JPMorgan to defend its Greek bond role [Financial Times via MSN Money]