Greece will receive 14.5 billion euros ($17.9 billion) in aid from the European Union at around 1000 GMT (6 a.m. ET) on Tuesday, a central bank official said, in time to pay an 8.5 billion euro bond the next day.
It was Greece's presumed inability to pay this debt, which matures on Wednesday, that prompted the EU and IMF to intervene with a 110-billion euro emergency aid package. The IMF has already lent Greece 5.5 billion euros.
The 14.5 billion will be transferred to Greece today. We expect the transaction to take place by noon, a bank official close to the deal told Reuters.
According to a standard convention for Greek bonds, Greece would not technically default on its payments as long as it paid the principle within seven days and the interest within 30 days, though the markets might well have viewed any delay differently.
Greece has embarked on the huge task of cutting its deficit from some 14 percent of GDP to 3 percent by 2014 to meet the conditions of the EU/IMF aid, but faces a series of large protests against the cuts.
(Reporting by Lefteris Papadimas; Writing by Jon Hemming; Editing by John Stonestreet)