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Greece, troika meet to wrap up talks: sources

EU, IMF and ECB mission chiefs met Greek finance minister Evangelos Venizelos on Monday with the intention of concluding weeks-long talks on a key aid tranche, a source close to the negotiations said.

business Updated: Oct 10, 2011 14:56 IST

EU, IMF and ECB mission chiefs met Greek finance minister Evangelos Venizelos on Monday with the intention of concluding weeks-long talks on a key aid tranche, a source close to the negotiations said.

Without the next 8 billion euro aid instalment Athens could run out of cash as soon as mid-November, risking a default that would drag the euro zone deeper into a debt crisis already shaking financial markets worldwide.

"We are working on the assumption that meetings will wrap up today," the source close to the talks told Reuters on condition of anonymity.

The mission chiefs will then likely conclude their visit by issuing a joint statement on Monday or Tuesday. Back in Brussels and Washington, they will prepare reports for euro zone finance ministers and the IMF's board, who will decide on the aid tranche.

The inspectors resumed their review of Greece's finances and reforms at the end of September, nearly four weeks after suspending talks over disagreements on the steps required to put the country's finances back on track.

Senior officials from the so-called troika of EU, IMF and ECB inspectors said last week they wanted more details on the impact of plans to slash the public sector workforce and increase taxes before concluding their review.

The leaders of Germany and France promised on Sunday to unveil a new comprehensive package for solving the euro zone's debt crisis by the end of the month. But they offered no details and papered over differences on how to shore up European banks.

Greece's central bank said on Monday it had activated a rescue fund to save Proton Bank, effectively nationalising the lender, which is under investigation for possible violation of the country's money-laundering laws.

Greek bank stocks tumbled 11 percent on Monday on concerns that other banks may follow small lender Proton in using a rescue fund.

"After the use of the rescue fund for Proton Bank, there are concerns that other banks might follow, which would have a negative impact for their shareholders," said an Athens-based bank analyst who declined to be named.

Another Greek analyst said investors were also concerned by the risk of a bigger haircut on Greek government bonds.