Greek debt held by ECB cannot be restructured, says Coeure

Greek government debt bought by the European Central Bank to help Greece during the sovereign debt crisis cannot be restructured, ECB Executive Board member Benoit Coeure said in an interview with France 24 radio station.

Greece will hold a parliamentary election on January 25, with a lead in the polls for SYRIZA, a leftist party that opposes the country’s international bailout program and vows to tear up a deal with the European Union and the International Monetary Fund.

Coeure told France 24 that Greek bonds bought by the ECB since 2010 to help Athens could not be restructured.

“It is illegal and contrary to the treaty to reschedule a debt of a state held by a central bank. The European treaties are very clear on this,” Coeure told the station.

Asked if the Greek election and the potential for a SYRIZA victory, which has shaken financial markets, meant the ECB had further reason to act and launch a state bond buying program, Coeure replied: “No, there’s no connection. The monetary policy decisions of the ECB are for the whole of the eurozone and Greece is a very small part of the euro. So they are two different discussions,” Coeure said.

“That doesn’t mean that the ECB is not following very closely the developments in Greece,” he continued.

Coeure also said discussions about a possible Greek exit from the euro made “no sense.”

“Greece is in the eurozone, Greece needs the euro and Europe needs Greece. I think there is a very strong effort of the European political authorities to preserve the entirety of the eurozone. It was said in 2012 and repeated since,” he said.

“For me, it’s not a debate and no one is working on a Greek exit.”