FRANKFURT, Germany—The head of Germany's banking association says the country's banks are standing by a proposed, voluntary 50 percent reduction in Greece's bond debt.
But Michael Kemmer says that the planned bond swap will have to wait until after Greece's referendum, if it takes place.
Kemmer says the planned exchange can only happen when the Greek government makes a formal offer, and that doesn't make sense until after the referendum results are in.
Prime Minister George Papandreou has proposed holding the citizen vote on the terms of Greece's latest euro100 billion ($140 billion) bailout. The bailout deal includes debt relief at the expense of bank bondholders -- but also a commitment to harsh spending cuts.
A "no" vote would void the bailout and could mean debt default.