Greek debt rescheduling for private investors too: EU's Rehn

(BRUSSELS) - Greek debt held by banks and other private investors could be "re-scheduled" alongside that held by EU states and the IMF, EU Commissioner Olli Rehn said Tuesday.

"While debt restructuring is not on the table, a initiative that aims at maintaining the exposure of private investors in Greece could be pursued as agreed for Portugal," EU Economic Affairs commissioner Olli Rehn said on the margins of a meeting of finance ministers.

"In this context a voluntary extension of loan maturities, the so-called reprofiling or rescheduling on a volontary basis, could also be examined," he said after two days of talks largely focused on how to deal with Greece's 330-billion-euro debt mountain.

This is an idea pushed by Germany as part of plans to give Greece longer to pay back what it owes, rather than pumping in fresh bailout aid too soon.

Berlin says it will look at waiting longer to get its money back -- it puts in the lion's share among eurozone states -- but only if banks and other investment funds do likewise, so that taxpayers are not the only ones taking a hit.

The theory is that such debt-holders could be convinced that it is in their longer-term interest to try that approach, otherwise a rapid write-down might be the best they could get.

Ministers have begun to look at various scenarios to prevent a repeat of the Greek debt crisis spreading around the eurozone the way it did a year ago, which led to subsequent bailouts for Ireland and Portugal as well as pressure on other states' borrowing costs.

One senior diplomat said it was a "valid approach" for the EU to "buy time," arguing that while the EU has often been criticised for being behind the curve on markets, its resistance to rushing in had successfully removed Spain, the eurozone's fourth-largest economy, from the financial intensive care ward.

In the meantime, Greece is under EU and IMF orders to detail tens of billions worth of public assets over the coming days it is ready to sell off in a giant privatisation drive.