Outcome of Greek negotiations and timeline

After long hours of negotiations, euro area leaders eventually came to a positive agreement on Greece. As expected, this agreement outlines a list of prior actions to be passed in Greek Parliament by Wednesday before some member states' parliaments (between Wednesday and Friday) engage their national procedures and negotiations on a fully-fledged program can actually start.

In the words of the euro summit statement, there is a crucial need to rebuild trust with Greek authorities and that they show ownership of the reform program. Another precondition on a new ESM program is that Greek authorities will have to make a program request to the IMF so that the Washington based institution remains engaged from March 2016 (end of the second bailout), says Barclays.

In the meantime, the eurogroup has been tasked to find bridge financing solutions to ensure Greece meets its payment obligations over the summer (EUR7bn by 20 July and EUR5bn by mid August), aimed at clearing its arrears with IMF, and Bank of Greece, notes Barclays. The eurogroup had to discuss solutions at their scheduled meeting yesterday.