Business

France to return 754 mln euros in Greek interest payments

by fm

5th July 2012

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1 min read

France is to return to Greece 754 million euros in interest payments the Bank of France earned on its Greek bond holdings, according to an amended 2012 budget bill.

The European Central Bank indicated in February that national central banks could pass on profits from their Greek bonds to governments, who could then funnel the money to Greece.

The ECB is forbidden from financing governments directly.

"The French state will return to Greece the interest earned by the Bank of France on Greek debt it holds to the amount of 754 million euros," the French budget document said.

France's new Socialist government announced a series of tax increases worth 7.2 billion euros on Wednesday in order to make up for a shortfall caused by weak economic growth.