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UPDATE 1-Germany considering Greek debt rescheduling -report

Published 01/19/2011, 05:57 AM
Updated 01/19/2011, 06:00 AM

* German paper cites unnamed government sources

* Gives few details about reported plan

* Unclear if referring to debt rescheduling or restructuring

* Greece denies in debt restructuring talks

(Adds details)

BERLIN, Jan 19 (Reuters) - A German newspaper said on Wednesday Berlin was considering a Greek sovereign debt rescheduling plan that would allow Athens to buy back its own debt using a euro zone crisis fund.

Greece's deputy finance minister said no talks on debt restructuring were ongoing. It had denied on Tuesday that it would seek to extend the repayment period of its debt after the deputy prime minister spoke in support of a such a plan.

Die Zeit weekly, citing unnamed government sources, said in a preview of Thursday's edition that the plan was to let Greece use credits from the European Financial Stability Facility (EFSF), in return for a commitment to pro-stability policies.

The newspaper used the word 'Umschuldung', which could refer to either a restructuring or a rescheduling. It gave no more details about the plan or conditions of any such buyback.

It did however add that, again according to unnamed sources, Germany was "no longer fundamentally opposed to increasing the lending capacity of the EFSF" as part of a broader package of measures to stabilise the euro.

This is largely in line with what Finance Minister Wolfgang Schaeuble has said regarding the need for a "complete package" that would address the limits to the real capacity of the euro rescue package because of its complex guarantee system.

(Editing by John Stonestreet)

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