January 18, 2018 / 5:07 PM / a month ago

Euro zone very close to releasing next Greek loan tranche

BRUSSELS, Jan 18 (Reuters) - Euro zone finance ministers could decided on Monday, or soon afterwards, to release the next tranche of bailout loans to Greece after the country pushed through a batch of laws to meet reform agreements with it creditors, a senior EU official said.

Finance ministers from the 19 countries sharing the euro meet for monthly talks on Monday and a review of Greek reforms is one of the top items on the agenda.

Last Monday, the Greek parliament approved a bill for fiscal, energy and labour reforms requested by international lenders. This is likely to complete the third and penultimate review of Greek reforms, unlocking new loans.

“We are extremely well on our way towards the completion of the third review,” the senior EU official said.

“There are a number of administrative measures to be taken still. As of yet we cannot say that all the preconditions (for disbursements) have been successfully completed simply because the time lines are as they are,” the official said.

Lenders’ experts, who are now translating and checking the Greek laws, are to issue a report on their compliance with the bailout’s requirements on Friday.

The new loans would be between 6 and 7 billion euros ($7.3-8.6 billion), disbursed to Greece in more than one tranche, the official said. Greece would use the money to redeem maturing debt, to pay arrears and to create a cash buffer for when it leaves its third bailout in August.

“We can be confident that the disbursements will ... start in February, probably in the second half,” the official said.

The final review of Greece’s performance under the bailout is expected in June, with disbursements of the last loans in July so that Athens has cash when it becomes fully dependent on market financing in August.

The euro zone bailout fund ESM has the option of offering a precautionary credit line to Greece that Athens could use if needed, but such a credit line would come with conditions and Greece has no intention of requesting one, the official said. ($1 = 0.8170 euros) (Reporting by Jan Strupczewski and Francesco Guarascio; editing by Philip Blenkinsop)

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