Greece says it is close to a deal with its private creditors that would slash $130 billion of its debt to help it secure a new bailout and avoid defaulting on its loans.

Greek Finance Minister Evangelos Venizelos said Tuesday he has personal knowledge of the negotiations, and believes his country is nearing an agreement with its lenders throughout Europe that would cut Greece's $260 billion in debt in half. That also would save the Athens government more than $6 billion a year in borrowing costs.

The negotiations are part of a late October agreement under which the 17 nations that use the euro set the terms for Greece's $169 billion bailout. That would be the second round of international assistance for the debt-ridden country in two years.

Banks holding Greek securities were under pressure from European leaders to cut the country's debts in half, but left details to the negotiations that Venizelos now says are nearing a conclusion.

Venizelos said talks on the bailout would start in mid-January. He said Greece must continue to implement its austerity plan to cut the government's deficit spending, overhaul its tax system and catch tax evaders.