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Although it is time for the next visit of the supervisory Troika to Athens, the mission of the International Monetary Fund, the European Central Bank and the European Commission postponed it. The reason is that the Greek government is not ready yet with the final version of the medium-term fiscal programme that is to be implemented by 2014. At the same time, this year’s set of measures which should reduce the deficit by about 1.8 billion euros by the end of 2011 is falling behind.

And because no trouble comes alone, the National Statistical Service warned that the size of the budget deficit will be revised but not in a direction positive for the socialist government.
 
The significant difference in the budgets of social security funds, which actually have reported 900 million euros deficit instead of 500 million euros in surpluses played a practical joke on the government. The result of these differences and other minor discrepancies in the spending of a few more institutions threaten to turn the recovery programme upside down and to shoot the deficit from 9.6% of the GDP to over 10% of the GDP.

The supervisory Troika decided to postpone its visit for a few days until the government clarifies its position on major issues related to the economic policy in the next three to four years. Currently, the Ministry of Finance is coordinating the medium-term recovery programme with the other ministries, which in turn have not yet submitted their proposals for it. And because Greece is a democratic country and public dialogue is obligatory (no matter whether it will result in something) and time is a flexible term in these latitudes, the final version of the mid-term recovery plan has not been voted yet.

Also, the decisions on the new sources of revenue or on reduction of costs to 1.8 billion euros required by the two major lenders of Greece have not been taken either.

Apparently, Poul Thomsen and company have learnt a lesson from their previous trips to Athens and this time asked the government to send a preliminary written report on the level of implementation of the reforms programme to be psychologically prepared for what awaits them in Greece during their next visit. According to Naftemporiki, this report is not yet ready, so the supervisors postponed their visit for now.

At the same time, Standard & Poor's announced the expected downgrading of four of the largest Greek banks. The National Bank of Greece, EFG Eurobank, Alpha Bank and Piraeus Bank were downgraded by the credit rating agency and remain under the CreditWatch with negative expectations. The credit rating of the National Bank of Greece fell from BB+ to B+ in the long run. This inevitably affected its subsidiary bank in Bulgaria, United Bulgarian Bank (UBB) which was lowered from BB to B+.

S&P downgraded the other three Greek financial institutions - EFG Eurobank, Alpha Bank and Piraeus Bank from BB to B+ in the long term. The Greek ratings of the banks came two days after the downgrading of Greece by two points this week. The lower credit rating of the banks was a natural response, mainly due to continued deterioration in the economic and operational environment in the country.