(Financial Times) -- Germany would be prepared to adjust the terms of Portugal's €78bn financial rescue programme after a second bail-out package for Greece had been finalised, Wolfgang Schäuble, the Germany finance minister, has told his Portuguese counterpart.
His unguarded comments, caught on camera during a meeting in Brussels, will fuel expectations among economists and investors that Lisbon may have to ask for additional rescue funds and more time to pay.
"If there appears a necessity for an adjustment in the Portuguese programme we would be ready to do that," Mr Schäuble said in a private conversation later broadcast by Portuguese television.
"That's much appreciated," Vítor Gaspar, Portugal's finance minister, replied.
Both ministers, speaking in English during a meeting of European finance ministers on Thursday night, appeared to be unaware that their conversation was being recorded.
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Mr Schäuble stressed that Berlin would consider an adjustment to Portugal's bail-out agreement with the European Union and the International Monetary Fund only "after the major decisions on Greece". "That's key," he said.
A German government official said that using an open microphone at the traditional photo-opportunity at the start of the ministers' meeting was "scandalous" and "a serious breach of journalistic standards".
But the official confirmed that Berlin was open to considering changes to Portugal's programme -- although it was "entirely speculative" what these might entail, in part because of the current focus on Greece.
"Countries that are delivering on, or even beyond, their obligations ... may find it easier to obtain agreement from their [eurozone] peers on possible modifications to these programmes," the official told the FT.
Mr Gaspar told journalists later that the "very short, private conversation" had referred only to the possibility of European partners extending their financial assistance to Portugal if the country faced difficulties in returning to international bond markets for "reasons beyond its control".
"There is no Portuguese initiative to introduce more flexibility into the programme. On the contrary, we are committed to fulfilling it," Mr Gaspar said.
In sovereign debt markets, the premium demanded by investors to hold Portuguese debt over that of Germany narrowed 62 basis points to 10.89 per cent on Friday, according to Tradeweb. Portuguese 10-year bond yields, which move inversely to prices, fell 60bp to 12.83 per cent. Yields on Spanish and Italian bonds, by contrast, were higher.
Under its bail-out programme, Portugal is scheduled to return to the medium- and long-term debt market next year, in time to finance a €9bn debt repayment that falls due in September 2013.
But many economists, as well as Portuguese business leaders and a former government minister, have said there is little realistic prospect of Lisbon being able to comply with this schedule.
Pedro Passos Coelho, Portugal's prime minister, has insisted that his country will meet all its commitments under the rescue agreement and will not need to ask for "more time or more money".
But he has acknowledged that the EU and IMF are committed to extending their financial support if Portugal complied with the bail-out programme, but was unable to return to the debt market next year due to "external reasons".
The prime minister has said there is no risk of private investors being asked to suffer losses on Portuguese debt. European leaders, seeking to quell potential contagion, have also given assurances that Greece is a "unique and exceptional" case.