Greece needs another 15B euros, above current 230B euros of aid

BRUSSELS (AP) — Greece’s international debt inspectors have discovered that the debt-ridden country still needs an extra euro15 billion ($20 billion) in help — on top of a promised euro130 billion bailout and a euro100 billion debt relief from private investors, a European official said Thursday.

The European Commission, the executive arm of the European Union, has asked the other 16 countries that also use the euro to help foot the bill for the missing euro15 billion, the official said, indicating that a limit has been reached of what can be achieved by Athens implementing further cuts and private investors taking losses on the bonds they hold in the country.

The gap could be filled either though more help from eurozone governments or by eurozone central banks or state-owned banks like France’s Caisse de Depots taking a cut on their Greek bondholdings, the official said. He was speaking on condition of anonymity because of the sensitivity of the matter.

The new push for Greece’s public and government creditors to take a cut on their investments — dubbed the official sector involvement, or OSI — is a new front in the battle to save the country from a potentially devastating default. So far the eurozone and the International Monetary Fund have given billions in bailout loans to the struggling country, but they haven’t been asked to take losses.

The official added that a related deal with private creditors to take losses on their holdings has to be announced before the end of the week, adding that experts from national finance ministries will discuss the tentative deal on Friday.

People familiar with the talks on so-called private sector involvement — or PSI — have said that the deal would see investors take losses of more than 70 percent through a 50 per cent cut in the value of the bonds, a lower interest rate of between 3.5 per cent and 4.5 per cent on the bond and more time to pay back the debt.