EFSF proposes Greek bank shares as loan collateral - report
HELSINKI | Wed Aug 31, 2011 7:17am BST
HELSINKI (Reuters) - Finland and other euro zone countries might get Greek bank shares as security in exchange for new loans to Athens, German newspaper Handelsblatt said.
According to the report citing unnamed sources, Klaus Regling, the head of European Financial Stability Facility (EFSF) has introduced the idea to euro state finance ministers, and officials are due to discuss the issue early next week.
Greece's second bailout package, planned to total 109 billion euros (96.5 billion pounds), includes earmarking of some 20 billion euros for Greek banks. In return, banks would be partially nationalized, and those shares would then work as loan collaterals, Handelsblatt said.
Earlier this month Finland revealed a deal with Greece to obtain cash deposit in exchange for loans. That sparked requests from countries including Austria, the Netherlands, Slovenia and Slovakia for similar treatment.
Analysts have said the resulting row could jeopardise a second Greek bailout.
Euro zone official have had negotiations in conference calls this week, trying to reach agreement on the collateral question.
Finnish Prime Minister said on Tuesday he expected the issue to be solved in "days or weeks."
The Nordic country has been adamant in demanding collateral as a prerequisite for participating the bailout.
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Questione Finlandia.