Monday evening’s critical Eurogroup has authorized the Euro Working Group to decide upon the outstanding two-billion-euro tranche, by the start of next week. The seven-day extension is essentially recognition of the Greek government’s progress in implementing the program and cooperating with its creditors. An agreement is now necessary on the primary residence auctions and other unresolved, secondary primary actions.
Following the conclusion of Monday evening’s session, Eurogroup President Jeroen Dijsselbloem commented that a lot of work has been done and progress achieve in cooperation between both sides. Mr. Dijsselbloem referred to upcoming bank recapitalization, expressing his satisfaction with the progress and confidence that it would conclude smoothly. The Dutch Finance Minister noted how the process was going smoother and quicker than expected.
The Eurogroup President also noted that the Greek government has committed to providing a solution on auctions and bank managements by the next week. Provided that Greece fulfills this commitment, then the Euro Working Group will convene and – should there be a positive outcome – the European Support Mechanism (ESM) will convene afterwards.
The head of the ESM Klaus Regling noted that while there was progress achieved, a number of unresolved issues prevent the payment of further aid. Should the Greek government manage to fulfill these obligations, then the 10 billion euros earmarked for the bank recapitalization can be paid out, even within the week.
Mr. Regling also stated that the results of the recent stress tests carried out were far better than expected and that the full 86 billion euros provided in the third Greek bailout deal may not be necessary.
