Do not believe Europe wants 'Grexit': Varoufakis

Greece does not believe its European partners will ultimately let the country leave the euro zone, Greek Finance Minister Yanis Varoufakis said on Saturday, as the country races to agree a cash-for-reforms deal with its creditors.

Athens is trying to clinch a deal before an end-June deadline to release the final tranche of a 240 billion euro bailout and avert the risk of the country crashing out of the euro zone.

Asked whether it was possible that Greece could leave the single currency, Varoufakis told BBC he did not think any European official wanted to see that outcome. "I don't believe that any sensible European bureaucrat or politician will go down that road," he told BBC Radio Four's Today programme. Asked whether the European Union and the International Monetary Fund were bluffing Varoufakis said: "I hope they are."

Greek Prime Minister Alexis Tsipras has sent a delegation to Brussels with a new set of proposals for Greece's creditors following a barrage of demands to get serious about making concessions or assume responsibility for a default.

With markets closed, the negotiators arrive on Saturday to meet with officials from the trio of lenders withholding money unless their demands are met. The aim is to narrow differences on pension, tax and a primary surplus target ahead of a meeting of finance ministers on Thursday in Luxembourg, according to a Greek official speaking on condition of anonymity.

In Frankfurt, a top official of the European Central Bank told an Austrian newspaper that it wants Greece to remain in the euro. Asked about Greece's membership of the currency bloc, the ECB's chief economist Peter Praet told Saturday's edition of German magazine Der Standard: "The Governing Council of the ECB wants Greece to remain a member of the euro."

The Governing Council sets policy at the bank. Praet also stressed the need for trust between countries that embark on reforms and those which give them financial backing. "When a country agrees to do something, it has to implement the agreement. The more credible a country is, the more patient creditors can be and the more trust they can show," he said.

Greek officials and the country's creditors were due to resume talks in Brussels on Saturday on a cash-for-reforms deal Athens needs to clinch by an end-June deadline to avoid a default and possible exit from the euro zone.

Germany's finance ministry, meanwhile, denied a report that its officials were working on a plan to allow an orderly debt restructuring for any country that becomes insolvent. Der Spiegel had reported that Finance Minister Wolfgang Schaeuble asked officials to draft plans for a system of debt restructuring for any insolvent country so that it could stay in the euro. But on Saturday, a spokesman for the finance ministry denied that any preparation of such a framework was taking place.

"This report is not correct," he said. "We are focusing our efforts entirely on the resolution of the current Greek crisis within the framework of the current (aid) programme."