Asmussen rejects Athens' call for ECB to roll over Greek bonds

Mon Oct 14, 2013 7:24pm EDT
 
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By George Georgiopoulos and Martin Santa

ATHENS/LUXEMBOURG (Reuters) - The European Central Bank cannot roll over Greek bonds as this goes against a ban on financing governments, a senior ECB policymaker said on Monday, dashing Athens' hopes it will help plug a funding gap next year through such a move.

Athens will be financed by bailout loans until the second half of 2014, when it hopes to tap bond markets again. It then faces a funding gap of nearly 11 billion euros for 2014-15, the International Monetary Fund and Athens estimate.

Finance Minister Yannis Stournaras said on Monday that Greece planned to roll over debt next year to narrow the funding shortfall. He said that euro zone central banks had promised to roll over Greek bonds and that if they did not they should make up the difference by other means.

But ECB Executive Board member Joerg Asmussen ruled out the idea, which is banned under the ECB's statutes.

"We must find a way to close this financing gap and there is absolutely no way that it can be done in a way of rollover bond or whatsoever which results in monetary financing," Asmussen told reporters in Luxembourg.

"This is not possible for the ECB and not for the whole euro system."

In the latest in a series of options Greek officials have floated as ways to cover the shortfall, Stournaras said Athens planned to roll over about 4.5 billion euros ($6.1 billion) of debt due next March.

Greece's international lenders have agreed they could give the country further debt relief if it meets fiscal targets this year, likely in the form of lower financing costs or extended repayment times for its loans.   Continued...

 
Greece's Finance Minister Yannis Stournaras and Executive Board Member of the European Central Bank (ECB) Jorg Asmussen (R) attend a eurozone finance ministers meeting in Luxembourg October 14, 2013. REUTERS/Francois Lenoir