FRANKFURT European Central Bank policymakers are still divided on what contribution the ECB could make to a restructuring of Greece's sovereign debt, two euro zone monetary policy sources said on Wednesday.
With private creditors having already largely agreed to write down the value of their Greek bonds, Athens and the commercial banks are calling on the ECB to accept some losses to help cut the debt to a sustainable level.
While the ECB has ruled out joining private creditors in voluntarily accepting a reduction in Greek bonds' value, it could send Athens, via a roundabout route, the profits from bonds it bought at below face value.
But the ECB's 23-member Governing Council has yet to agree a position, with some of the policymakers reluctant for the bank to show a willingness to share in the restructuring burden for fear of easing the pressure on Athens to agree spending cuts.
"There is no agreement yet. Some people on the Council still oppose this," said one of the two monetary policy sources, adding that ECB President Mario Draghi had not yet revealed his position.
"I am not aware that a decision has been taken," said the second source. "As far as I know no formal decision has been made, although of course it is one of the things we could theoretically agree to."
The officials spoke after the Wall Street Journal, citing people briefed on Greece's debt restructure negotiations, earlier reported that the ECB had made key concessions over its holdings of Greek government bonds that would contribute to a reduction of the country's debt burden.
The aim of the restructuring is to reduce Greece's debts by around 100 billion euros ($130 billion), cutting them from 160 percent of gross domestic product to 120 percent by 2020, a level EU and IMF officials think will be more manageable for the shrinking Greek economy.
Greece needs the restructuring to secure a new EU/IMF rescue to avoid a chaotic default, but repeated delays in Greece on agreeing a reform deal it must complete as part of the deal have prompted warnings that the euro can live without Athens.
Greek parties will try to agree a reform deal on Wednesday. Time is pressing: failure to reach a deal by March, when Athens must repay 14.5 billion euros of maturing debt, could result in a disorderly default.
The ECB, the biggest single holder of Greece's sovereign debt, bought its Greek bonds at a discount. One of the sources said the difference between the face value and the market price it paid is 11 billion euros.
That difference would roughly match what is needed to plug a recently opened up shortfall in Greece's debt deal, according to analysts, although some EU officials now doubt even that would be enough with Greece ever deeper in the red. ($1 = 0.7552 euros)
(Writing by Paul Carrel; Editing by Ruth Pitchford)