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Greece will default by the end of 2011, stated the international agency Standard & Poor's. In Beijing, the head of the states’ credit rating department David Pierce said that the current process of involving private creditors implies bankruptcy, because it reduces the debt.

According to Moody's too Greece is one step closer to default because of the bilateral agreement for cash guarantees signed with Finland against the participation of Helsinki in the second bailout. The agency’s message reads that such agreements will have a negative effect on the evaluation of troubled countries and will lead to delay in payment of the next tranche. Experts say that if other countries insist on similar agreements, the capital available for further rescue packages will be limited. Moody's sees in the agreement the reluctance of some countries in the euro area to exert more pressure on Germany and France for taking effective measures to rescue the euro.

Finland's participation in the second bailout for Greece is negligible - only 2 per cent, but the consequences of this agreement could be huge, the agency recalls. A representative of the German government said today that Greece is very likely to have obliged to sign similar agreements with other countries. According to the same source, quoted by Naftemporiki, the other countries in the euro zone will have to ratify the Greek-Finnish agreement too. In its report on the European economy in August Bundesbank openly opposes the decision taken on the Summit of July 21, which, according to it, does not motivate the governments to maintain financial discipline.

Greek banks are waiting to receive today the so-called Memorandum of Understanding for participation in the roll-over of Greek government bonds, which is expected to be between 8 and 15 per cent and 21 per cent for some banks. The financial institutions will include that participation in the results for the first half of 2011 and proceed to reduce their capitalization. The entire procedure is expected to be completed by the end of August 2011. Financial analysts point out that the roll-over value is not that great, but unfortunately, the roll-over is not the only obstacle faced by the banks. The talks with the Black Rock Solutions start on August 29 and its experts will study the credit records of the banks - a procedure that Greek bankers expect to be very painful.

The next major problem is liquidity, which is hanging over the Greek financial sector as a Damocles sword. The European Central Bank currently does not accept as guarantees Greek government bonds to pay the Greek banks the € 30 billion, which were decided on July 21. Probably, the Emergency Liquidity Assistance, which could be put into operation within this week, will replace the European Central Bank.