The European Union's executive said on Monday it was ready to propose a framework that could be used to aid Greece, despite signs of continuing reluctance from France and Germany to make concrete commitments.

Ministers were expected to discuss the possibility of providing loan guarantees or bilateral loans to help Athens finance its debts if needed, but officials signaled no figure would be put on the amount of help that could be extended.

European Monetary Affairs Commissioner Olli Rehn confirmed the Commission had succeeded in drawing up proposals for a mechanism that could be put to a meeting of the euro zone's 16 finance ministers in Brussels.

I would expect that Europe would endorse the assessment of the Commission on Greece's bold set of measures which would mean that Greece is on track to meet the 4 percent target of deficit reduction this year.

We will also discuss how to safeguard financial stability in the euro area as a whole, he said. The Commission is ready to table a proposal for a European framework for coordinated and conditional assistance.

The 16 countries that use the euro single currency have provided strong verbal and political support to Greece since its debt and deficit problems exploded three months ago, but have been unable to agree on the need for financial aid.

Germany, Europe's biggest economy and the country that would be the linchpin of any support, is reluctant to bail out Greece, saying the country's priority must be to get its own finances in order and make deep structural adjustments to rein in spending.

The 16 finance ministers gather in Brussels from around 1500 (1400 GMT) for a meeting that begins at 1700.

Market prices for Greece's debt rose on hopes of a more detailed commitment by the meeting, but analysts said a failure to do so could spark more selling.

No political decisions will be made, a German government spokesman said of Monday's meeting.

Those comments played down widespread talk over the weekend that a detailed plan could be in the offing but it was not clear whether they left room to announce a deal on the technical details of how aid could be given.


The German spokesman reiterated that Greece had not asked for support and was working to resolve its problems by itself.

Greece this month unveiled a set of new austerity measures, including cutting public sector pay and raising taxes. A poll on Sunday showed most Greeks saw it is as a good step.

The measures and the euro zone's verbal backing have helped ease the premium Greece must offer over benchmark German bonds as it seeks to refinance some 20 billion euros in debt in April and May.

But the spread remains unsustainable, analysts say, and officials are looking at what could be done to insulate Athens against market turbulence and a risk of default that has hurt the euro.

Under EU rules, neither the bloc nor individual states can assume the debts of other countries, but loan guarantees or similar measures would circumvent those restrictions.


French Economy Minister Christine Lagarde said over the weekend she did not expect any figure for aid to be announced.

I'm certainly not expecting any decision being made, or any button being pressed... it's totally premature, she told reporters late on Saturday.

She said Greece had delivered enormously with its austerity steps, which include promised spending cuts equal to 2 percent of gross domestic product.

On Saturday, Britain's Guardian newspaper quoted sources as saying the meeting would agree up to 25 billion euros of support. A senior EU source said that was not on the table.

The German government spokesman said Monday's meeting would also not get into the details of funding for a European Monetary Fund, an idea that has been proposed by Berlin as another measure to help protect euro zone countries with debt troubles.

Discussing reforms needed to shore up the group's rules, German Finance Minister Wolfgang Schaeuble reiterated that it should eventually be made possible, in extreme cases, for a state to leave the euro zone if it fails to manage its finances.

We need tighter rules, he told daily Bild. That means in an extreme case, the possibility that a country that does not get its finances in order at all leaves the euro group. Such a prospect alone would ensure a totally different kind of discipline.

(Writing by Luke Baker, editing by Patrick Graham)