Greece was in the final stages of getting private creditors to write off nearly a third of its massive debt in a \"titanic\" effort being rushed through on Friday. The country faces default if it cannot get banks, insurance companies and funds to cancel about €107 billion (Dh527 billion) in government bonds as part of a wider deal to solve its debt crisis. A proposal on what is known as private sector involvement, or PSI, was to be made public soon, a Finance Ministry source said. Finance Minister Evangelos Venizelos has said an official offer to private creditors must be made for a debt swap to be concluded by March 12 on a first set of bonds. Venizelos said rating agencies \"might declare Greece in selective default\" while the debt-swap operation was ongoing but added: \"There is a full mechanism to cover liquidity in the meantime.\" The swap, in effect a cancellation of nearly a third of the €350 billion in debt owed by Greece, is part of a rescue stitched together with the Eurozone and International Monetary Fund to avert default on March 20. \"Greece has made a titanic effort to finalise the decision on PSI and conditions for granting the aid,\" Prime Minister Lucas Papademos told his cabinet. \"The legal procedure is satisfactory, but there are still unresolved issues,\" he added. Overall accord Under the overall Brussels accord, Greece would also receive up to €130 billion in direct loans by 2014, helping it avert a debt default next month. In exchange, Greece agreed to tough new austerity measures and tighter EU-IMF oversight of its economy. After months of talks, it seemed likely that most private creditors would accept the deal, mindful that they could get nothing at all if Greece were to default. Second rescue act by EU/IMF This would be the second EU/IMF rescue for Greece, but the bond component depends on the rate of participation by private investors. They were to get precise proposals on the swap and then decide whether to accept a 53.5-per cent loss on their holdings. Terms of the deal were hammered out with negotiators from a body that represents private creditors, the Institute of International Finance, and were a part of marathon talks held earlier last week in Brussels.