BRUSSELS (AP) -- The finance ministers of the 16 other countries that use the euro on Thursday agreed in principle to give Greece a first batch of bailout money to finance a massive debt relief deal with private investors.
However, the final green light for as much as €93.5 billion ($125.69 billion) -- which Greece needs to implement the debt swap -- will come next week.
After a three-hour meeting in Brussels, the ministers said the payout can go ahead once Athens has passed "a few pending implementing acts" for promised austerity measures and the ministers how many banks and investment funds will actually participate in the bond swap.
A successful implementation of the €107 billion ($143.84 billion) debt relief deal with private bondholders is a precondition for Greece to receive the rest of the €130 billion bailout.
Private investors have until next Thursday to decide whether they will swap their Greek bonds for new ones with a lower face value, lower interest rates and longer repayment periods.
Overall, bondholders will lose more than 70 percent of the value of their holdings, but in return they will receive some of the money they are owed immediately and have at least the hope that they will get some more of it back in 30 years. Without the debt relief deal and the new bailout, Greece would have defaulted on its debts within weeks, potentially sending ripples across the world financial system.
Of the €93.5 billion Greece needs in the coming weeks, as much as €35.5 billion are immediate payouts for banks and other investors participating in the bond swap.
Around €23 billion will be used to recapitalize Greek banks that would otherwise collapse under the losses from the debt relief.
The remaining €35 billion will go as collateral to the European Central Bank while Greece's own bonds are rated in selective default. That money will be freed up again once Greece's rating improves.