ATHENS (AFP) - Former Greek prime minister Lucas Papademos, who oversaw a controversial debt swap in 2012, was wounded on Thursday (May 25) by a letter bomb that detonated inside his car, the first terror attack targeting a former leader in decades.

Papademos, who headed an interim coalition government at the height of Greece's fiscal crisis, was wounded as he read his post in the back of a black Mercedes, police said.

"I unreservedly condemn the attack against Lucas Papademos (and) wish a speedy recovery to him and the people accompanying him," Prime Minister Alexis Tsipras tweeted from Brussels, where he is attending a Nato summit.

Parliament also interrupted its session to condemn the attack.

Evangelismos Hospital in Athens said that Papademos, 69, sustained "superficial injuries to the chest, abdomen and legs" but that his condition "does not inspire concern." Two of his guards who were in the car also sustained light injuries.

A police source said Papademos had just left the Athens Academy, the country's top research establishment, which has named him its chairman for 2017.

The attack method pointed to domestic far-left group Conspiracy of Fire Nuclei, which has orchestrated similar attacks, a police source said.

An employee at a local bike shop told reporters that smoke spewed from the Mercedes and that the occupants came out with their clothes tattered.

"The police will take all necessary steps to shed light on this case," government spokesman Dimitris Tzanakopoulos told reporters outside the hospital.

Calls have already gone out to individuals who could be potential targets to heighten their vigilance, and to the Greek postal service to step up a search for other similar devices.

The blast happened on a busy Athens highway, according to an AFP reporter who went to the scene. It left a dent on the car's hood and shattered the rear windshield, but reports said the damage inside was extensive.

Papademos was in an armoured car provided by the bank, which contained the blast but probably worsened his injuries, state television ERT said.

'HEINOUS ACT'

"We are shocked. I wish to condemn this heinous act," media minister Nikos Pappas told ERT.

Papademos served as prime minister from November 2011 to May 2012 after the resignation of George Papandreou's socialist government, steering a batch of austerity measures through parliament before stepping down for elections to be held.

In 2012, Papademos's government negotiated a huge write-down of the country's privately held debt.

The move was widely criticised at the time, as Greek social insurance funds lost millions of euros in the process.

Papademos also drew fire for letting members of a far-right party join his coalition government.

Papandreou said Thursday that the attack against "a man we invited to help Greece at a time of difficulty" was "a blow to the dignity of every Greek citizen."

Bank of Greece governor Yannis Stournaras said the attack "will not curb our morale."

Former prime ministers Costas Simitis and Costas Karamanlis also condemned the attack, the first since an attempt on the life of dictator Georgios Papadopoulos in 1968.

Greek statesman Eleftherios Venizelos also narrowly escaped assassination by royalist gunmen as he rode in a car with his wife in 1933.

An economist by training, Papademos had also served as Bank of Greece governor from 1994 to 2002, and was vice president of the European Central Bank from 2002 to 2010.

There was no immediate claim of responsibility for the blast.

HISTORY OF LETTER BOMBS

In March, the Conspiracy of Fire Nuclei, which is considered a terror organisation by Washington, mailed a letter bomb that injured a secretary at the International Monetary Fund in Paris.

The group had earlier claimed responsibility for an explosive device, also sent from Greece, that was discovered by the police at the offices of German Finance Minister Wolfgang Schaeuble.

The bombs contained gunpowder used in firecrackers, police said.

To make it more likely that the letter bombs would be opened, the attackers used the names of Greek politicians as alleged senders.

The group also sent letter bombs to foreign embassies in Greece and to European leaders in 2010.

In contrast to other groups who have used industrial explosives and assault weaponry, Conspiracy tends to use common materials in their attacks such as gas cannisters, gunpowder extracted from firecrackers, and pressure cookers.

The organisation denounces capitalism, consumerism, police repression and worker exploitation.

Police say the name "Conspiracy of Fire Nuclei" has been used as cover by urban militants carrying out minor arson attacks against car dealerships and police vehicles since the middle of the last decade. But their activities escalated from early 2008 onwards.

In 2011, several of its members, many of whom were very young, were convicted of "participating in a criminal organisation" and given long sentences in prison.

But three years later the group announced its return and has since committed sporadic attacks.