The interest Greece is paying on the bailout loans would be lowered, their maturities lengthened, and the "flexibility and scope" of the eurozone bailout fund would be "enhanced".
Separately, officials said that the terms of the aid package from Europe to Greece would be eased, with maturities lengthened to 15 years from 7.5 years, at an interest rate of a quite low 3.5 percent.
A normal yield curve slopes gently upward, reflecting a gradual increase in interest rates as maturities lengthen out.
Indeed, preferred shares are best considered as substitutes for bonds, a conservative way to raise portfolio income without going into bonds, which are subject to sharp price swings, the volatility becoming progressively greater as maturity lengthens.
The yield differences between munis and Treasuries become more pronounced as maturities lengthen.
City analysts warned that the Spanish yield curve, which normally rises as bond maturities lengthen, was "flattening" as the yield on typically less risky debt rose.
"If all this happens we will have to address the issue of whether a light restructuring of Greek debt could be pursued in which maturities are lengthened, with respect to debt servicing, and interest rate levels (on EU loans are reduced)," he said.
European officials could offer a menu of ways to achieve that: reducing the principal owed, cutting interest rates or radically lengthening maturities.
In doing so he disagreed publicly with Christine Lagarde, the IMF's chief, sitting next to him, who insisted that the 2020 date should be kept.Either way it is clear that Greece's debt will at the very least need to be rescheduled, for example by lengthening maturities or lowering interest rates.
If Europe's leaders fail to extricate Greece from its current unsustainable debt-servicing obligations — by lowering interest rates and lengthening maturities at a minimum — the market reaction, for all of Europe, may be unforgiving, and uncontainable as investors conclude that no European sovereign debt is safe from possible default.
