FINLAND HAS secured a deal to receive collateral on its rescue loans to Greece but on terms so strict that no other euro zone country will follow suit.

The agreement breaks months of deadlock after bailout sceptics in Finland threatened to disrupt plans for a second Greek rescue with demands for security on its portion of rescue aid for the country.

Finnish prime minister Jyrki Katainen said the deal is “workable” for use in potential future bailouts.

“The thing is quite complex so I wouldn’t dream of trying to explain it to you,” Minister for Finance Michael Noonan said.

“It was agreed in a manner that allowed other countries to avail of the same collateral if they wanted, but there didn’t seem to be anybody bidding for it today so it’s an issue simply for Finland.”

The collateral does not come cheaply. Helsinki will have to speed up its payment of capital into Europe’s new permanent bailout fund and it will receive a smaller share of the profit from the operations the European Financial Stability Facility (EFSF)temporary fund.

The collateral won’t be paid out in the event of any default until after EFSF’s loans to Greece mature, a period which ranges from 15 to 30 years. In addition, Finland will receive no more than 20 per cent of the increase in its guarantee to the enlarged EFSF in the event of a default.

The new pact follows the collapse of a previous bilateral deal between Greece and Finland.