EU refuses to deny reports on ECB participation in Greek bailout

Feb 8, 2012, 12:32 GMT

Brussels - The European Union's executive refused Wednesday to deny reports indicating that the European Central Bank was ready to contribute to the new bailout being prepared for Greece.

In October, the EU and the International Monetary Fund (IMF) agreed on a 130-billion-euro (173-billion-dollar) package, but that is no longer deemed enough due to Greece's worsened economic outlook.

To help fill the funding shortfall, the ECB has accepted to forego at least some of the profit it was due to make on the Greek bonds it bought last year as part of attempts to prop up the debt-plagued country, The Wall Street Journal reported Wednesday.

'I cannot confirm those reports and I think this is very much a question that needs to be asked to the ECB,' Amadeu Altafaj, spokesman for EU Economy Commissioner Olli Rehn, told reporters in Brussels.

The Wall Street Journal said the ECB offer of help could be worth as much as 11 billion euros.

Altafaj also said that the Eurogroup panel of eurozone finance ministers would only meet after Greece had secured a debt writedown deal with private lenders and its politicians had agreed on the austerity measures the EU and IMF are demanding in return for new aid.

For the meeting to happen 'there has to be something concrete on the table,' he said.

Luxembourg's Prime Minister Jean-Claude Juncker, who heads the Eurogroup, said the Athens negotiations were showing signs of progress.

'By early tomorrow (Thursday), we will have a definitive picture of the additional burdens that Greece is prepared to take on,' Juncker said.

Greek political leaders were meant to meet on the issue with Prime Minister Lucas Papademos late Tuesday, but the talks were postponed to Wednesday.

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