Yields on Greece's new bonds may climb to as high as 20 percentamid “material risks” stemming from implementation of terms for thebiggest sovereign restructuring in history, according to MorganStanley.

Traders are offering to buy and sell the potential new bonds atyields on 11-year securities of 22 percent, according to a personfamiliar with the prices who declined to be identified. Yields onexchanged Greek debt may be about 13 percent to 17 percent “in themedium term” as the nation faces an election and seeks to complywith terms of its bailout and debt-reduction programs, NewYork-based Morgan Stanley said yesterday in a research report.

Private investors agreed to swap about 85 percent of their Greekgovernment bonds for new securities, according to a banker briefedon the results. The goal of the exchange, results of which arescheduled for release later today, is to reduce the 206 billioneuros ($273 billion) of privately held Greek debt by 53.5percent.