Merkel quashes talk of ESM increase, Greek bridge loan

BERLIN Jan 23 (Reuters) - German Chancellor Angela Merkel said on Monday it was not the time for debating an increase in funding for euro zone bailout funds and the priority was to ensure the effectiveness of the current fund and fast introduction of its permanent successor.

The chancellor told a news conference with Belgian Prime Minister Elio Di Rupo there was no question of extending Greece a bridging loan if talks with its private sector creditors about a haircut drag on, as some media have reported.

"The priority now is to get the ESM (European Stability Mechanism, the permanent facility) into operation, to conclude negotiations and see how much capital we will pay in," Merkel said when asked about IMF chief Christine Lagarde's comments in Berlin on the need to boost the funding of the ESM.

(Reporting by Stephen Brown and Alexandra Hudson)