New blow to PM as party splits

Rebels from Greece's Syriza party yesterday formed a breakaway parliamentary group after Prime Minister Alexis Tsipras resigned, paving the way for the crisis-hit country's fourth election in three years.

Tspiras announced his resignation late Thursday, going on the offensive to defend the tough terms he accepted in the 86-billion-euro ($96 billion) rescue package which had triggered a rebellion in his hard-left Syriza party.

The European Union said Tsipras's decision was "not a surprise" and that it remained confident the reforms promised by Athens as part of the deal agreed last month after weeks of difficult negotiations would be carried out.

According to the constitution, following the resignation of the premier, the president must give a three-day exploratory mandate to each of the three largest parties in parliament to see if they are able to form a coalition government.

If they fail, the president then names a caretaker administration, usually under a senior judge, to hold early elections.

The Syriza rebels, now calling themselves the Popular Unity group after the alliance that brought Chile's Salvador Allende to power in 1970, were also to receive an essentially empty mandate.

At least 25 rebels out of a total of 149 Syriza MPs will join the new party, making it the third largest grouping in the outgoing parliament.