Draghi says ECB "by and large done" on helping Greece

FRANKFURT Thu Nov 8, 2012 9:23am EST

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FRANKFURT (Reuters) - The European Central Bank is unlikely to help Greece much further in its bailout because it is prohibited from providing direct aid, ECB President Mario Draghi said on Thursday.

"The ECB is by and large done," he said told his monthly news conference when asked about what the bank could do for Greece.

The euro zone is grappling to find a formula to make Greek debt sustainable, with Germany and the International Monetary Fund at odds over the need for governments and the ECB to take a "haircut" on Greek bonds they hold to make the numbers add up.

The ECB has refused to take such a hit on its Greek bonds, saying this would be "monetary financing" which it is prohibited from doing.

The bank agreed earlier this year to hand over via governments any profits on its Greek bonds made during Greece's 3-year bailout package -- an amount that would add up to roughly 5 billion euros.

But there remains the possibility of handing over profits beyond that timeframe as well in a similar fashion.

The total stands at around 12 to 15 billion euros and would be passed to national central banks, which in turn will pass it to their governments. They can then pass it to Athens.

"It's up to the governments to decide whether they want to use these profits for Greece," he said. (Writing by Paul Carrel. Editing by Jeremy Gaunt.)

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Comments (1)
ARTIMID wrote:
So, out of the tears and blood of one country (11 million people) the ECB and its stakeholders have made profits amounting to 5 billion euro in 3 years, the total amount to reach between 12 and 15 billion euro! Hey, that seems quite a lucrative business to me. Why return these profits to the Greeks? Why not keep squeezing them? You may get even more juice.

Nov 09, 2012 8:09am EST  --  Report as abuse
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