Greece on Tuesday raised €1.3 billion ($1.7 billion) in a three-month treasury bill auction with demand to spare, returning to short-term debt sales after completing an EU-funded debt buy-back last week.

During the auction of €1.0 billion of 13-week treasury bills conducted today, the total bids reached €1.73 billion and the amount finally accepted was €1.3 billion," the state debt management agency said in a statement.

The sale offered a yield of 4.11% to lenders. In the last three-month auction in November, the agency had raised €1.3 billion at an interest rate of 4.20%.

Greece last week attracted offers of €31.9 billion in a bond buy-back designed to alleviate its enormous sovereign debt by some €20 billion.

The scheme was a condition for the unblocking of pending EU-IMF loans, which had been held back since June owing to reform delays and a protracted electoral campaign in Greece that raised doubts about the future of its fiscal overhaul.

Because of the delay in receiving the EU-IMF funds, Greece had been forced to make emergency one-month debt auctions in November and earlier this month.

Following the approval of European leaders last week, Greece is to receive €34.3 billion in scheduled bailout aid in December, and another €14.8 billion in the first quarter of next year.

The first €7 billion was disbursed on Monday and another €27.3 billion is expected by Wednesday, a Greek official said on Tuesday.