Finance ministers from the euro area will hold an extraordinary meeting on February 11 to discuss the situation in Greece, Dutch Finance Minister Jeroen Dijsselbloem said on twitter late Friday.
Ministers will exchange their views on the future course of action on the Greek bailout, which is set to expire on February 28. On the following day, EU leaders including Greek Prime Minister Alexis Tsipras will meet in Brussels.
Tsipras is set to deliver a speech to the Greek parliament on Sunday, unveiling his plans to revive the economy.
Greece is seeking a bridge loan from Europe rather than an extension of the bailout program. But several EU states have reportedly dismissed such an option.
Greece's sovereign ratings were downgraded by Standard & Poor's Ratings Services on Friday as its liquidity constraints narrowed the time frame for the new anti-austerity government to reach an agreement with its external creditors.
The risk of a Greek default and exit from the Eurozone has risen in the past week, Jennifer McKeown an economist at Capital Economics said. "While we are still not explicitly forecasting an exit, we think that markets are underestimating the probability of such an event," the economist said.
Finance Minister Yanis Varoufakis last week suggested issuing an extra GBP 10 billion of bills to fund the government spending. But the European Central Bank voiced its resistance.
S&P lowered the sovereign ratings of Greece to 'B-' from 'B'. The ratings on Greece remain on CreditWatch with negative implications.
"Although the newly elected Greek government has been in power for less than two weeks, we believe its limited cash buffers and approaching debt redemptions to official preferred creditors constrain its negotiating flexibility," S&P said.
After the suspension of Greek bond collateral eligibility by the European Central Bank, the rating agency expects it to curtail the liquidity provision to the Greek banking system if the two-month technical extension of the European Financial Stability Facility programme is not extended beyond its current expiration date in February.
Further, S&P sees uncertainties connected to the provision of liquidity to Greek banks as potentially exacerbating deposit outflows, depressing investment, and weakening tax compliance, which are already deteriorating economic and fiscal profile of Greece.
The rating agency aims to update or resolve the CreditWatch status of the rating by the next scheduled publication date for Greece, which is on March 13.
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