Greece debt crisis resulted in 2.9 billion euros profit for Germany


Loans and bonds purchased in support of Greece since 2005 have resulted in profits of 2.9 billion euros (3.3 billion dollars) for Germany, the government confirmed in response to a parliamentary query submitted by the opposition Greens.

The profits come from a range of deals - including the Securities Market Programme (SMP), a now-defunct bond-buying programme initiated by the European Central Bank in 2010 - that Germany and other members of the eurozone backed to keep Greece's economy afloat.

There has been increasing pressure in Germany on Finance Minister Olaf Scholz of the Social Democrats (SPD) to ease the financial pressure on Athens.

Scholz said his government was considering ceding part of the profits to Athens.

Speaking to reporters at the sidelines of a eurozone finance ministerial meeting, Scholz said that such profits had been made available to the Greeks before.

He added that eurozone finance ministers would discuss "how this may happen again" as arrangements are made for the future.

Germany's central bank, the Bundesbank, received a 2.9-billion-euro windfall from the SMP programme, which it transferred to the German budget. The figure also includes a 400-million-euro profit generated from a 2010 loan from development bank KfW, which is owned by the German government.

Sven-Christian Kindler of the Greens said the windfall for Germany warranted a debt cut for Greece, adding that it was unacceptable for the "federal government to sanitize its budget with billions in profits from interest from Greece."

In contrast with the "right-wing myths," Germany had profited massively, he said, adding that Greece had kept its part of the bargain and should now be assisted by other countries using the euro.

Greece's third assistance programme of up to 86 billion dollars expires in August amid signs that the country can now service its debts. This year it anticipates a budgetary surplus of 0.8 per cent of gross domestic product on GDP growth of 1.9 per cent.

Without the debt burden, the surplus would be 4.2 per cent of GDP.

Eurogroup finance ministers are meeting in Luxembourg, where a preliminary decision on Greece could be taken.