MANNHEIM (MNI) – European Central Bank Governing Council Axel Weber
Tuesday refuted press reports according to which he had told German
lawmakers in a closed door session that Greece could need E80 billion to
avoid default.

Speaking to reporters after a speech in Mannheim, Weber said that
he has never “made an assessment of long-term or short-term financing
needs” for Greece.

“These were not my figures. I merely cited them,” Weber said. He
noted that the E80 billion had first come from Greece, which then
quickly withdrew the figure.

The head of the Bundesbank said that in a private meeting Monday,
from which the comments attributed to him were leaked, he had only noted
that liquidity needs are hard to gauge and can be bigger than expected.

“The liquidity that a country needs is hard to peg,” since it
depends on the behaviour of all investors, Weber warned.

Weber also dismissed reports that he had compared Greece to the
German bank HRE, which required repeated financial injections from the
German government.

“I did not make a comparison between HRE and Greece, I only used it
as an example to illustrate that liquidity needs are uncertain,” Weber
said.

Eurozone finance ministers last week unveiled an agreement under
which they would offer up to E30 billion worth of loans to Greece in the
first year of a 3-year contingency program. The IMF would kick in an
additional amount, which well-placed sources have estimated at E10
billion to E15 billion in the first year of the plan. The Eurozone
ministers said more funding would be available if needed in subsequent
years, but they did not put a number on it.

Media reports published Monday, notably in the Wall Street Journal,
reported that Weber had told German lawmakers that the debt-laden
Mediterranean country could require up to E80 billion to cover its
debts.

Weber also reportedly warned that the situation in Greece was
growing worse. “The numbers are changing all the time,” an unnamed
source quoted Weber as saying. There is “no alternative” to bail out
Greece, he reportedly told the lawmakers.

–Frankfurt bureau: +49-69-720 142, email: frankfurt@marketnews.com

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