* Greece showing signs of pulling out of recession
* Sale will mark remarkable return from default
* However, debt burden unaffordable in long run
* Ireland already out of bailout, Portugal to follow
* Bond cash eases pressure on privatisation front (Adds Greek finance minister in paragraphs 8-9)
By Alex Chambers
LONDON, April 3 (Reuters) - Greece is planning to return to the international bond market this month, four years after it became the first euro zone country to be bailed out and only two years since defaulting on its debts.
With Greece showing signs of pulling out of a crippling recession, the government aims to raise 2 billion euros ($2.75 billion) in a sale of five-year bonds, banking sources told Thomson Reuters markets service IFR on Thursday.
A power company is also poised to become the first Greek state-controlled enterprise to sell bonds since Athens had to turn to the European Union and IMF for the rescue.
Greece has been frozen out of long-term international borrowing since 2010 and imposed losses on private bondholders as recently as 2012 in a 130 billion euro debt restructuring, meaning it will be staging one of the swiftest comebacks by a country from default.
Greek bond yields, which have fallen dramatically since the restructuring, hit fresh four-year lows on Thursday after the country lined up a group of banks to manage the sale.
Two sources said Deutsche Bank, Bank of America Merrill Lynch, JP Morgan and Goldman Sachs have been given the mandate for the sale, which aims to benefit from a feeling that Greece is finally emerging from a crisis which has wiped a quarter off its economic output in the past six years.
The exact timing has still to be determined and the final list of banks could change, they said. "This is the most important deal Greece will do," said one banker.
But expectations grew that the issue was imminent. When asked by reporters in Athens whether Greece could issue a bond in the coming days or next week, Greek Finance Minister Yannis Stournaras replied:
"I cannot tell you. The only thing I can say is that the date will be determined by market conditions."
While Ireland has already left its EU/IMF bailout programme and Portugal plans to follow in May, Greece's problems are far from over.
Unemployment is at 27.5 percent and government debt was an estimated 176.2 percent of annual economic output at the end of 2013, a level which is unaffordable in the long term.
Its debt burden has soared from an already sky-high 130 percent in 2009 as the government borrowed heavily from the EU and International Monetary Fund under the 237 billion euro bailout which kept the country afloat.
"GREECE IS BACK"
Nevertheless, Prime Minister Antonis Samaras told Reuters on Wednesday that "Greece is back", and investors last month gave a bond issue by Piraeus Bank, the first by a Greek lender in four years, a warm welcome.
Public sector companies are also following suit, entering debt markets for the first time since the country's crisis erupted. Electricity utility PPC, which is 51 percent state-owned, plans to sell at least 300 million euros of debt this month, two sources familiar with the matter told Reuters on Thursday..
Finance Minister Yannis Stournaras told Reuters on Wednesday that Greece's first post-crisis foray into bond markets would be on a "trial and error" basis, but the nation expects to fund itself without help from the EU and IMF in 2016.
Stournaras pointed to more positive attitudes among euro zone finance ministers who meet in the Eurogroup. "The mood has changed dramatically recently. Simply look at what happened at Eurogroup - everybody thinks that Greece now is out of the woods," Stournaras said.
Athens could follow its first bond sale with further issues later this year, depending on market conditions, he added.
Greek yields have tumbled from more than 30 percent after the restructuring in 2012 as investors sought higher returns. Greek 30-year yields dropped below 6 percent for the first time in four years on Thursday. Ten-year yields fell 8 basis points to 6.14 percent.
The Eurogroup met in Athens this week after the EU and IMF finally agreed a programme with Athens to allow bailout funds to keep flowing. Stournaras said Greece did not need additional financing beyond its current bailout for the next year, and hoped it would not need fresh aid for the year after that.
The government posted a budget surplus before interest payments last year, making it eligible for further debt relief from its partners. That may take the form of extending repayment terms on existing bailout loans and lowering interest rates, rather than injecting fresh funds.
Tapping bond markets reduces pressure on Athens to meet its ambitious privatisation targets. International lenders agreed to lower the bar to about 1.5 billion euros this year from a previous target of 3.56 billion, the executive chief of privatisation agency HRADF said on Thursday.
HRADF has so far signed asset sale deals worth 4.9 billion euros since the bailout started four years ago, raising 2.69 billion euros in cash, CEO Ioannis Emiris told reporters.
This is far below an original target to raise 22 billion euros over the period. Greek asset sales have often been hampered by lack of investor interest as well as by regulatory and legal hurdles raised in Greece and the EU.
($1 = 0.7263 Euros) (additional reporting by Harry Papachristou, Angeliki Koutantou and Lefteris Papadimas in Athens and John Geddie in London; editing by Julian Baker, David Stamp and Giles Elgood)