UPDATE 1-EU’s Rehn excludes Greek debt restructuring

* EU’s Rehn – We exclude Greek debt restructuring

* ECB’s Trichet – We should stick to EU/IMF plan on Greece

* Report: Some fin ministers want restructuring

By Sakari Suoninen and Erik Kirschbaum

BERLIN/GODOLLO, Hungary April 9 (Reuters) – A restructuring
of Greek debt is out of the question, Economic and Monetary
Affairs Commissioner Olli Rehn said on Saturday.

German magazine Der Spiegel reported on Saturday that
several euro zone finance ministers told European Central Bank
President Jean-Claude Trichet in a conference call last week
they had doubts if Greece would meet its fiscal targets and
suggested Athens should restructure its debt.

“We do exclude (a Greek debt) restructuring. We have a solid
plan and we are working on the basis of that plan and it is
based on careful analysis of debt sustainability,” Rehn told a
news conference, when asked about the German magazine report.

The Der Spiegel report said several finance ministers had
said Athens would be unable to meet its fiscal targets and
return to the markets for funding next year and asked if a debt
restructuring for Greece would be sensible in view of the
situation. But Trichet blocked the idea and said he was not
willing to discuss it, Der Spiegel said.

Asked to comment on the magazine report, Trichet echoed
Rehn’s comments:

“On Greece, I would say we have a plan, that plan has been
approved by the international community and approved by the
European institutions and we apply the plan.”

Der Spiegel said Rehn had told the EU Commission last week
that any idea of a Greek restructuring, if it were to be
required, should not be discussed in public but would simply
happen at some point.

Der Spiegel said Trichet feared that a restructuring could
damage confidence in the entire euro zone and could hit banks
holding Greek debt hard.

German Finance Minister Wolfgang Schaeuble viewed Trichet’s
concerns about capital markets to be exaggerated and not
credible, Der Spiegel said.

In Godollo, Hungary, where EU finance ministers and central
bankers met on Saturday for a second day of informal talks,
Schaeuble warned against fueling speculation in financial
markets. Speculation over solutions to Greece’s problems when it
has to return to normal debt markets next year was not helpful,
he said.

“We are at any moment ready to cooperatively find solutions
to new problems,” Schaeuble said.

“They are not advanced by speculative remarks.”

Public debate on a restructuring has been almost taboo since
Athens accepted a 110 billion euro ($157 billion) bailout from
the EU and International Monetary Fund nearly a year ago, and
opposition to the idea remains high across the zone.

The Greek government has repeatedly ruled it out and the ECB
also opposes it.

But privately, some senior euro zone government officials
are acknowledging what economists have been saying for months —
that some form of restructuring may have to happen, probably in
2012.

Aid under Greece’s three-year rescue package is due to flow
until June 2013, but to emerge safely from its bailout, the
government will have to demonstrate before then that it can tap
capital markets for long-term funding.

Athens has said it would like to resume selling
longer-maturity paper later this year, or in 2012 at the latest.
(Reporting Sakari Suoninen by Erik Kirschbaum; editing by Susan
Fenton)

UPDATE 1-EU’s Rehn excludes Greek debt restructuring