UPDATE 4-EU finmins agree on 500 bln euro future rescue fund

* Euro zone discussed changes to EFSF, no decisions

* Eurogroup discussed cheaper emergency loans, no decisions

* March 11 EU summit likely to help narrow down EFSF options

(Adds final news conference)

By Jan Strupczewski and Justyna Pawlak

BRUSSELS, Feb 14 (Reuters) - Euro zone finance ministers agreed on Monday that a permanent rescue mechanism to be set up from 2013 would total 500 billion euros, but are waiting for EU leaders' guidance to agree changes to the existing bailout fund.

The new fund, the European Stability Mechanism (ESM) [ID:nLDE6AS05Z] will be part of a "comprehensive package" of measures European leaders are hoping to agree in late March to resolve the year-long debt crisis.

"We've already agreed on the volume of the lending capacity of the ESM. We've agreed on the amount of 500 billion, and this will be subject to regular revision," the chairman of euro zone finance ministers Jean-Claude Juncker told a news conference.

Speaking after a meeting of European Union finance ministers, Juncker said the 500 billion euros would be the effective lending capacity of the new rescue fund.

Apart from the euro zone, the ESM would also get cash from the International Monetary Fund and, possibly, from voluntary contributions from non-euro zone European Union countries.

Economic and Monetary Affairs Commissioner Olli Rehn said the IMF's contribution could be 250 billion euros, but noted the size had not been discussed with the IMF yet.

"The unwritten understanding with the IMF is that there can be 50 cents to one euro that the Europeans have themselves contributed to such operations as we have for instance in the cases of Greece and Ireland," Rehn said.

DEAL ON FUTURE, NOT ON PRESENT RESCUE FUND SIZE

The ESM is to be a permanent crisis resolution fund and is likely to include the possibility of private investors having to mark down their holdings if a euro zone state becomes insolvent.

It is to be created in mid-2013 to help solvent countries through liquidity problems and replace the 3-year European Financial Stability Facility (EFSF) and the European Financial Stability Mechanism (EFSM), which now together have, nominally, the same 500 billion euros at their disposal.

The EFSM has 60 billion euros and the EFSF has euro zone government guarantees for up to 440 billion euros ($596 billion), but its effective capacity is only about 250 billion because of guarantees needed to secure a triple-A rating.

That sum could be insufficient to bail out more than two countries if both Portugal and potentially Spain were to follow Greece and Ireland in needing a bailout. [ID:nLDE7101AC]

The ministers therefore want to increase the EFSF's effective lending capacity to the full 440 billion euros and give it operational flexibility, but there is no agreement -- and quite some divergence -- over how bst to do that.

"Today we discussed various measures to reinforce the EFSF in order to make sure that it is as effective as it needs to be," Juncker said.

"What I'd like to say is that both the EFSF and ESM are not the subject of overall agreement until everything is agreed. Nothing is agreed until everything is agreed," he said.

COMPETITIVENESS REFORMS AND STRONGER EFSF

Germany, whose support as Europe's largest economy is essential to any deal, is reluctant to back an increase in the EFSF unless other euro zone member states sign up to measures to cut spending and make their economies more competitive.

Its "competitiveness pact", backed by France, envisages higher retirement ages, national laws to cap debt, a common corporate tax base and an end to indexing wages to inflation.

But other euro zone countries have complained the proposal has not even been properly presented to them and while no one opposes the idea of becoming more competitive, many disagree with elements of the pact reported in the press.

"There are all sorts of ideas about competitiveness, well, about improving competitiveness," Juncker said, adding the Franco-German proposal was not discussed at the Monday meeting.

"All these ideas are, of course, part of the comprehensive response. So, in some respects, we have to await the results of the European Council ... (on March 11) before we can agree on everything," he said.

NO PREFERRED OPTIONS YET

The ministers explored ways to make the EFSF more flexible, which could include allowing it to buy the bonds of distressed countries, and making emergency loans cheaper. [ID:nLDE7101AC]

But Juncker said it was too early to say which options were the preferred ones.

"No decision has been taken so far and we will pursue this debate at the next meeting or next meetings, but it does not make sense to privilege one option or another," he said.

EU leaders are to meet first on March 11 and then on March 24-25 to strike a deal on the comprehensive package, although Juncker hinted there could also be a meeting in between. (Additional reporting by John O'Donnell, Annika Breidthardt, Ilona Wissenbach and Julien Toyer; writing by Jan Strupczewski; editing by Luke Baker)