EU wants banks' help with Greece to avoid default

By the Associated Press | June 6, 2011 | 3:13 PM EDT

Demonstrators shout slogans during a peaceful rally outside the Greek Parliament in Athens, on Sunday, June 5, 2011. Thousands of protesters have gathered for a 12th consecutive day to protest at fiscal austerity measures and demand that Greece stop paying its debtors. They have also denounced politicians of all stripes as incompetent and corrupt. (AP Photo/Kostas Tsironis)

BRUSSELS (AP) — European officials say they are looking for a way to get private creditors to give Greece some leeway on its debts without it being considered a default.

The chairman of the group of eurozone countries Jean-Claude Juncker said Monday "we are working on a formula that would not lead to a negative opinion from the credit rating agencies and that will not lead to a default."

EU Monetary Affairs Commissioner Olli Rehn said banks and other financial institutions will be asked to keep their lending to Greece at current levels.

He said they would likely also be encouraged to extend repayment deadlines for the bonds they hold.

A default could not only lead to market panic but would also be humiliating for the eurozone.