Monday, February 9, 2015

Greece to Seek $11.3 Billion in Financing to Avoid Funding Crunch

February 9, 2015

Greece will seek about 10 billion euros ($11.3 billion) in short-term financing as it tries to stave off a funding crunch while buying time to push its creditors to ease austerity demands.

Greece’s Finance Minister Yanis Varoufakis will present a proposal at a Wednesday meeting of euro area finance ministers in Brussels that will ask for an 8 billion-euro increase in the stock of Treasury Bills the country is allowed, said a government official who asked not to be named as the negotiations are confidential. It will also seek the disbursement of 1.9 billion euros of profits that euro area central banks made on their Greek bonds holdings.

The standoff between Greece and its creditors over the conditions attached to its 240 billion-euro lifeline risks leaving Europe’s most-indebted state without any funding as of the end of this month, when its current bailout expires. European leaders pushed back on Prime Minister Alexis Tsipras’s efforts to get out of austerity imposed by the previous government as a condition for Greece’s bailout, setting the stage for a clash.

“In the short term, we need to put together what some may call an extension or the Greeks might want to call a bridge,” French Finance Minister Michel Sapin said on Monday at a gathering of G-20 finance ministers in Istanbul. “Then we’ll have to find medium-term solutions going forward, looking ahead to June.”


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