ECB: Greek default could lead to 'uncharted waters'

ANKARA

European Central Bank governor Mario Draghi has warned that an unprecedented crisis could arise should Greece default on debt payments that are due in May.

Speaking at a press conference outside the International Monetary Fund (IMF) meeting in Washington late on Saturday, Draghi said: "We're certainly entering into uncharted waters if the crisis were to precipitate."

Greece is due to make two large debt payments in the coming weeks, one of €186 million ($200.9 million) to the IMF on May 6, and another of €707 million ($763.9 million) which is due on May 12.

The IMF has refused to offer any delay or grace period for these payments.

Should Greece default on the payments, Draghi said, "I don't even want to contemplate such an event."

"The Greek leadership has repeatedly stated they intend to honor all their obligations," he added.

A meeting for Greece and the Eurogroup of 19 member states is scheduled for April 24, at which time the economic reforms proposed by the Greek government will be formally considered.

The creditor group must agree to the list of reforms if Greece is to see the release of the next €7.2 billion ($7.8 billion) tranche of bailout funds under the plan agreed to originally by the previous Greek government in 2010. 

For now, the Greek government is set to run out of funds to run the country's banks and public services by the end of April.

Greek banks are now wholly dependent on emergency loans from the European Central Bank for funds with which to operate.