By Marius Zaharia LONDON, April 15 (Reuters) - European money markets are seen resilient for now in the face of growing talk of a potential restructuring of Greek government debt, but short-term rates could spike if such a move appeared imminent. Yields on government bonds issued by the most indebted euro zone states have risen over the past few days after Germany acknowledged for the first time that Greece may need to restructure its debt. [ID:nLDE73D05J] But traders said there was no sign of stress in repo or money markets because investors believed such a move, although seen as likely eventually, would not happen in the short term. "On one hand markets are playing the restructuring story, Greek yields are definitely not normal and price in some form of restructuring," said Kornelius Purps, a UniCredit strategist. "What (markets) are not playing is the ... possible ramification for the banking sector." Purps said that interbank lending would probably freeze immediately if concrete steps were taken towards restructuring, due to uncertainty over "who is going to be hit and by how much". Money market rates would probably spike like they did at the start of the financial crisis and Eonia rates could "even quadruple from one day to another", he said. But traders said there was no sign that interbank markets were heading towards that scenario yet. "If the debate evolves from 'if' to 'how' to (restructure Greek debt) we can expect some stress in repo markets and widening in short-term interest rates," one trader said. BETTER POSITIONED Some analysts said the interbank system was in a better position to cope with shocks now than it was at the start of the financial crisis. "If there is a crisis we know that the European Central Bank will provide banks with unlimited funding. This will be a shield," said Barclays Capital strategist Giuseppe Maraffino. ECB executive board member Lorenzo Bini Smaghi said this week that a Greek restructuring would be a "catastrophe", but some analysts believe a major impact on interbank markets could be avoided if a restructuring was done in an orderly way. "Because we believe a debt restructuring cannot occur over the next two or three years, I think money markets cannot be affected at this current point," said BNP Paribas rate strategist Matteo Regesta. "In the base case scenario, what you get is a communication policy which means that markets gradually adjust to the event. If the debt restructuring programme is properly announced and gradually fazed I would not expect an abrupt squeeze." Regesta said a rise in Eonia euro overnight rates EONIA= over the past few days had nothing to do with the sovereign woes and it was just a result of banks depositing reserves with the ECB at the start of a new maintenance period. "The current level of Eonia is simply a function of banks front-loading reserves," Regesta said. "I expect Eonia to stay between 1.10-1.17 percent (next) week and gradually decrease afterwards," he said, adding that it could fall towards 80-85 bps after Easter, as banks meet their reserve targets. Eonia was at 1.146 percent on Thursday, up from 1.139 percent. In normal liquidity conditions, Eonia trades just above the refi rate which is currently at 1.25 percent, but Reuters calculations show excess liquidity in the money markets is currently at around 21 billion euros.

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