ECONOMY

Eurozone works on Greece options

Eurozone ministers met on Tuesday in an effort to resolve a dilemma over how to twist banks? arms into ?voluntarily? contributing to a second Greece bailout and avoid a damaging debt default.

The latest attempt to rescue Greece?s finances hinges on to what extent banks, pension funds and insurers can be forced to accept new terms on old debts before getting their money back from Athens.

German Finance Minister Wolfgang Schaeuble insisted, however, that taxpayers in the eurozone?s biggest economy will loan Greece more money but only if the banks and other private creditors take their own hits too.

?The German government is ready to participate in supplementary measures,? Schaeuble said yesterday, but in that, ?of course, a role for the private sector is an element… We are in discussions.?

Echoing this hardline stance, his Austrian counterpart Maria Fekter said, ?We can?t leave the profits in the hands of the banks and the losses in the hands of taxpayers.?

Striking to the heart of the matter, she added, ?I?m having a hard time imagining that this can be done on a [purely] voluntary basis.?

The politicians want the banks – some of whom were previously bailed out by taxpayers – to contribute to a second Greek bailout so as to appease voters who think Athens has been wasteful and got off too lightly.

Dutch Finance Minister Jan Kees de Jager said on Tuesday that the private sector should contribute 20 to 30 percent of any new financing for Greece.

Meanwhile, Greek government bonds slumped after Standard