German Chancellor Angela Merkel’s government will oppose any attempt to make the European Central Bank accept a writedown on its Greek bond holdings, senior coalition lawmaker Michael Meister said.
“I can’t imagine that European politicians would allow third parties to make such an indecent claim on our central bank,” Meister, the deputy floor leader for Merkel’s Christian Democratic Union and the party’s ranking finance spokesman, said in a telephone interview today. “That contradicts our philosophy.”
Plans to cut Greece’s debt to 120 percent of gross domestic product can still be achieved with the voluntary help of private investors, Meister said. Widening the so-called private sector involvement plan to include the ECB is neither necessary nor politically permissible, he said.
“The U.K. and U.S. have a slightly different philosophy but we would regard such a move as indecent,” he said. Rather, it is “in the interest of private holders of Greek bonds to accept the terms of a writedown.”