ECONOMY

Institutions back eurozone payout to Greece, final decision possible Monday

institutions-back-eurozone-payout-to-greece-final-decision-possible-monday

Eurozone deputy finance ministers will discuss whether to disburse the next tranche of loans to Greece on Friday after institutions representing the creditors recommended a payout, but the final decision may wait until Monday, officials said.

To secure the release of the money, Greece approved a reform bill on Thursday, although the vote cost the ruling coalition of Prime Minister Alexis Tsipras' two deputies when dissenting lawmakers were expelled.

The bill, outlining regulation on tax arrears and home foreclosures, paves the way for the disbursement of 2 billion euros ($2.15 billion) to pay state arrears and up to 10 billion euro to recapitalize Greece's top four banks.

But even though the compliance report from the European Commission was positive, eurozone officials said, it listed one reform as still pending and three as needing to be followed up.

"I don’t think that any final decisions on the disbursement will be made today, rather on Monday," one senior eurozone official said.

"I guess it’s a done deal that they will get the 2+10 billion, but some of the milestones are still not yet completed today, so a couple of more days is needed."

There might be a teleconference of the deputy finance ministers again on Sunday, the official said.

A second official also said there would be no final decision on the disbursement on Friday.

"Firm decisions could happen on Monday if all goes well, but there is no total certainty yet," the second official said. "There is clearly progress, but some questions and smaller issues remain and an in-depth and detailed analysis has not yet been done."

A third official said the decision on the disbursement of the money for Greek bank recapitalization was likely to be formulated in a way that would authorize the bailout fund to pay out up to 10 billion euros for the purpose.

The Greek banking sector would need only between 6 and 9 billion euros in recapitalization money from the eurozone, the third official said.

The European Central Bank has estimated the total recapitalization needs of Greek banks at 14.4 billion euros, but the reminder of the money is likely to come from private investors, the official said. [Reuters]