Greece is to pay less and will have longer to pay back bailout loans to eurozone partners, while the single currency's rescue fund will step in to finance Greek banks, said a draft declaration being considered Thursday by eurozone leaders in Brussels, dpa reported. "We have decided to lengthen the maturity of (eurozone) loans to Greece to the maximum extent possible from the current 7.5 years to a minimum of 15 years," the draft said. The interest rate on the loans should fall to about 3.5 per cent, from the current level of 5.5-6 per cent, while the European Financial Stability Facility (EFSF) will be authorized to buy bonds from traders, lightening Greece's debt burden, it said. The EFSF would also "finance recapitalization of financial institutions through loans to governments" - addressing concerns that forcing traders to take a loss on Greek loans would trigger a selective default, which would in turn dry up financing for Greek banks. The draft does not contain an overall figure for the new Greek bailout, which would add to last year's 110-billion-euro (156-billion-dollar) rescue package. It also fails to mention how private banks would contribute to the effort, simply acknowledging their "willingness to support Greece on a voluntary basis through a menu of options (bond exchange, roll-over and buyback)." -- SPA
