Wilbur Ross: Greece will make a deal, but ...

Billionaire distressed asset investor Wilbur Ross said Monday he expects Greece to reach a deal with creditors, though pension and tax reforms are troublesome issues.

"I think the real sticking point is not debt forgiveness. I think its the pensions and to a lesser degree the VAT tax on the electricity," the chairman and chief strategy officer of WL Ross & Co. said on CNBC's "Squawk Box."

"The issue is whether Greece will make some reforms that give the political cover to the other countries to go along with the debt forbearance."

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Ross' firm and other international financiers invested $1.8 billion in Eurobank in April 2014, becoming the bailed-out Greek bank's biggest shareholders. Ross also represents a group of investors that owns 17 percent of Bank of Cyprus, of which he's vice chairman.

Greece and its mostly European creditors are locked in tense negotiations and struggling to resolve separate proposals to prevent a Greek debt default and potential exit from the European Union.

Greece's ruling Syriza party said last week it would delay a scheduled payment to the International Monetary Fund and instead group it in a bundle of payments at the end of the month. The country is seeking to unlock 7.2 billion euros in much-needed bailout funds in exchange for a package of promised reforms.

The Greek debt drama has been "overplayed" in the grand scheme of global markets, Ross said, noting that the country accounts for about 2 percent of European Union GDP and imports just $50 billion worth of goods from the rest of the EU.

"That's big relative to Greece. Greece has only got 11 million people, but 50 billion euros ... is a drop in the bucket for the EU," he said.

Ross said if Europe and Greece fail to clinch a deal, it would be "very bad" for his firm's exposure. The danger would be a collapse of the banking system, which is "on life support" with more than 80 billion euros of emergency liquidity funds.

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"If that stops coming in, and they go out of the EU and they go to the drachma, that would be very bad because that 80 billion euros probably now would have twice the cost that it had before," he said.

Ross said his firm is down about $30 million in equity in its Greek investment of $50 million, which he called "fairly small." He said the firm went wrong when it projected that then-Prime Minister Antonis Samaras would prevail in elections about six months ago.

Instead, opposition party Syriza came to power after promising to take a tougher stance with creditors.