European Stability Mechanism

The head of the eurozone rescue fund said it would be wise for Greece to pay back early its outstanding loans with the International Monetary Fund, as they are more expensive than the yields Athens currently pays in the markets on its bonds.

The German Finance Ministry is opposed to Greece's plan to pay off the bulk of its remaining debt to the International Monetary Fund early, daily Handelsblatt reported on Friday.

The government is planning to pay off some of the country's loans from the International Monetary Fund early, with the aim of using it to win support ahead of this year's general election, claiming that it is showing the IMF the way out of Greece.

The Greek government has not indicated that it intends to walk away from the agreed primary surplus target of 3.5 percent go GDP, the head of the European Stability Mechanism (ESM) Klaus Regling  said in an interview with state-run broadcaster ERT late Wednesday.

Klaus Regling, the managing director of the European Stability Mechanism (ESM), reiterated on Wednesday his call for Greece to stick to the reforms which were part of its eight-year bailout programs, saying its economy is on the right track.

In August 2018, Greece exited the economic programs with the European partner countries, the European Commission, European Stability Mechanism, European Central Bank, and the International Monetary Fund (the latter had already opted out). This was seen as an occasion for celebration.

The eurozone's bailout fund has approved the implementation of a major debt relief plan for Greece that it says would provide the crisis-scarred country significant savings over several decades.

The measures include a complex mix of interest rate improvements and repayment deferrals that were initially agreed upon in June.

Thursday's euphoria at local banks proved short-lived, despite the mobilization of the government and regulatory authorities, as the pressure on bank stocks returned on Friday - sending their sector's index down 1.78 percent - while experts say a bad bank might be preferable to the kind of asset protection scheme being prepared by the government.

The eurozone's European Stability Mechanism (ESM) bailout fund on Friday issued a statement denying recent press reports it was taking part in preparatory work for a possible intervention plan in favor of Greek banks.

Greece can use this year's improved budget numbers to change policies, as long as the government discusses them first with the country's creditors, the Managing Director of the European Stability Mechanism (ESM), Klaus Regling, said in an interview with Dutch newspaper De Telegraaf, published on Tuesday.