EU finance ministers on Tuesday discussed standby plans drawn up by countries using the euro to provide Greece with financial help if it becomes the first state in 11 years of monetary union to seek such aid.

Finance ministers from the 16-country euro zone announced late on Monday they had agreed to the "technical modalities" that would permit aid to be rapidly rolled out but gave no figures and few details of a plan likely to involve bilateral loans.

Before they reconvened on Tuesday with the other ministers from the 27-country European Union, Spanish Finance Minister Elena Salgado reiterated that Athens did not need help for now.

Her Swedish colleague, a critic of Greece, said things were looking up after Athens announced extra austerity measures to cut a bloated public deficit and tame a national debt that is bigger than the country's entire gross domestic product.

"We have a situation which is much better than one month ago," said Swedish Finance Minister Anders Borg, who earlier this year said that Greece's statistical reporting on public finances was "basically fraudulent."

Initial financial market reaction was muted, with no dramatic change in the euro exchange rate or bond yields, both of which have been buffeted by fears about Greece's ability to honor its debts and what this would mean for the monetary union more broadly.

Euro zone help for Greece could take the form of bilateral aid but loan guarantees were ruled out by ministers, said Jean-Claude Juncker, the Luxembourg prime minister who chaired Monday's talks.

A statement published by the euro zone ministers provided no figures. It commended Greece's recently redoubled efforts to repair its public finances and said the rest of the Eurogroup club of common currency countries stood ready to help.

"It (the Eurogroup club of finance ministers) clarified the technical modalities enabling a decision on coordinated action and which could be activated swiftly in the case of need," the statement said.

"The objective would not be to provide financing at average euro zone interest rates, but to safeguard financial stability in the euro area as a whole."

Greece this month unveiled extra austerity measures to knock its deficit from 12.7 to 8.7 percent of gross domestic product this year, including cuts in public sector pay and tax hikes. A poll on Sunday showed most Greeks saw this 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 ($27.5 billion) in debt that it has to roll over in April and May.

But the so-called spread, or debt financing premium, remains unsustainable, analysts say. Policymakers are also looking at what could be done to insulate Athens against market turbulence and a risk of default that has hurt the euro.

On Tuesday morning, the price investors demand to hold Greek debt instead of German benchmark bonds narrowed somewhat, coming in 12 basis points in early trading, but remained close to 300 basis points, or three percent, above German Bund yields.

Juncker said EU leaders would have the last word on any aid if it came to that. Belgian Finance Minister Didier Reynders suggested options were still far from set in stone.

"It could be guarantees, or loans, we will see," Reynders told reporters. "It will be on a voluntary basis."

Austrian Finance Minister Josef Proell said on Monday that the talks did not focus on how much money to have on standby.

Dutch Finance Minister Jan Kees De Jager said any help would be tied to tough conditions of the kind that the International Monetary Fund applies when rescuing countries in trouble.

"If we talk about measures, for example about loans, they will follow the same kind of methodology as the IMF," he said.

Germany, Europe's biggest economy and the country that would be the linchpin of any support, is reluctant to bail out Greece and above all to rush into anything before Athens shows it is willing to take the painful steps needed to fix its finances.

European Central Bank Executive Board member Lorenzo Bini Smaghi was quoted on Tuesday as saying "constructive ambiguity" could be useful to ratchet up pressure on troubled countries or institutions to take necessary steps.

Writing in the Financial Times, he said authorities should be ready for a bail out as a last resort to prevent worse problems developing.