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Greece gets second installment of EU/IMF aid

ATHENS (Reuters) - Greece said on Monday it had received part of a second installment of funds from its 110 billion euro EU/IMF emergency aid package, totaling 6.5 billion euros ($8.3 billion).

Debt-laden Greece has now received 26.5 billion from the emergency package. It will receive the remainder of the second installment, or 2.5 billion euros, on Tuesday, the finance ministry said in a statement.

Athens secured the aid deal from the European Union and the International Monetary Fund in May by committing to structural economic reforms and to slashing its budget deficit to 8.1 percent of gross domestic product this year from 13.6 percent of GDP in 2009.

It received the first installment of aid, worth 20 billion euros, on May 18 -- with 14.5 billion of it provided by euro zone countries and 5.5 billion euros from the IMF.

The finance ministry said on Monday that a payment of 6.5 billion euros ($8.3 billion) by Greece’s euro zone peers was deposited at the Bank of Greece by the European Central Bank.

The IMF would disburse the remaining 2.5 billion euros of the installment on Tuesday after its board approved the payment on Friday.

The IMF said last week that Greece was ahead of schedule in making necessary economic reforms and would disburse the funds under its 30 billion euro, three-year standby pact with Athens.

Data on Monday showed Greece slashed its cash deficit by 28 percent in January-August from a year earlier, but the pace of decline slowed sharply from a 41.8 percent drop in the deficit in January-June because debt servicing costs surged 64 percent in August.

The finance ministry said Germany and France made the largest contributions to the 9 billion euro second installment, providing 1.49 and 1.12 billion euros respectively.

Reporting by George Georgiopoulos; Editing by Susan Fenton

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