Eurozone finance ministry deputies are considering six options to find €12bn in short-term financing for Greece, including tapping an EU-wide rescue fund that has been fiercely resisted by the UK.
According to a memo obtained by the FT, the options were to be discussed by the deputies — know as the “euro working group” — on a conference call starting 8:30am CET on Tuesday, Peter Spiegel writes.
Greece needs €7bn of the €12bn by Monday, in part to pay a €3.5bn bond owed to the European Central Bank. If Athens defaults on that bond, the ECB could be forced to pull emergency loans keeping Greek banks alive.
The idea of using the remaining €11bn in the €60bn EU-wide rescue fund — known as the European Financial Stability Mechanism — has been backed by the European Commission with the support of France. Britain thought it had an agreement in 2012 never to use the fund again, but EU officials have argued that agreement is political and not legal. The fund could be tapped with agreement of a weighted majority of EU countries.
The other options under consideration, according to the memo, include bilateral loans from other eurozone countries or transferring €3.5bn in profits on Greek bonds held by the ECB, either as a loan to Athens or a grant.
Also on the table are transferring “buffer” funds in national treasuries of eurozone governments, securitising publicly-held Greek assets, or using existing EU development funds Athens is eligible for but normally used as financing for public works projects.