BRUSSELS - German Chancellor Angela Merkel laid out her terms for an aid package for debt-laden Greece, saying she supports loans from the International Monetary Fund and European governments as a last resort if default looms.

Asserting her clout as head of the European Union's largest economy, Merkel ruled out an aid decision at the EU summit in Brussels, which started after press time, pushed for the International Monetary Fund to be part of any eventual rescue, and called for tougher penalties on future deficit "trickery".

"A good European is not necessarily one who rushes to assist," Merkel told German lawmakers in Berlin on Thursday.