The German Bundestag has approved with a massive majority the expansion of the European bailout fund in what has become a major political victory for Christian-Democrat Chancellor Angela Merkel.

The bill to expand the fund was passed by 523 votes in favor, 315 of them from the government camp and the rest from the opposition, DPA reported.

Critics had demanded that Merkel show she had the support of at least 311 coalition deputies, or half the 620-member house plus one.

Merkel herself has described the expansion of the European bailout fund as critical to ensuring economic stability on the continent. It will go forward if six other euro area countries approve it over the coming weeks.

Merkel said this week that a July agreement with Greece on a second bailout (of EUR 109 B, after the first EUR 110 B bailout loan packaged granted to Greece in 2010) may have to be renegotiated based on the findings of an inspection team from the International Monetary Fund and other creditors that arrived in Athens on Thursday.

"We are in an exceptionally difficult situation, because the financial markets remain extremely uncertain," said German Finance Minister Wolfgang Schaeuble in parliament ahead of the vote, in a bid to win support for the measures, as cited by The Washington Post.

Germany became the latest country to approve expanded powers and a larger size for the European bailout fund, which is known as the European Financial Stability Facility (EFSF). Six countries still need to approve the changes, which were agreed to by euro area leaders in July and would bring the lending capacity of the fund up to EUR 450 B.

European leaders had been concerned that the original fund would not have enough money to cover the costs of extending assistance to a large economy like Spain's.

The German Parliament's approval vote comes after in early September an inspection team from the IMF, the European Central Bank and the European Commission, left Greece, saying it was falling short of meeting its commitments. In the past few days, Greece's government came up with new austerity measures that it hopes would be enough to earn it the next tranches of international bailout aid.

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