Official: account to ensure Greek debt service

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Associated Press

Posted on February 20, 2012 at 11:32 PM

Updated Tuesday, Feb 21 at 12:02 AM

BRUSSELS (AP) — EU economic affairs commissioner Olli Rehn says Greece's compliance with the terms of a new bailout will be ensured by a separate account containing enough money to service its debt for three months.

That close monitoring was demanded by some members of the eurozone who are frustrated that Greece has not always enacted painful reforms and budget cuts on time.

The account is part of a deal agreed to in the early hours of Tuesday to give Greece another €130 billion ($170 billion) in rescue funds to avoid a default next month. Officials say the deal would bring Greece's debts down to the maximum level considered sustainable, by, in part, asking private bondholders to take significant losses on their holdings.

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