S&P warning adds default threat to Greece's bailout

Greece would likely be in default if it follows a debt rollover plan pushed by French banks, S&P warned, deepening the pain of a bailout that one European official said will cost Athens sovereignty and jobs.

European politicians and bankers had expressed confidence last week that the French proposal would not trigger a default, but ratings agency Standard & Poor's said it would involve losses to debt holders, most likely earning Greece a "selective default" rating.

"It is our view that each of the two financing options described in the (French banks') proposal would likely amount to a default under our criteria," S&P said.

S&P cut Greece's sovereign rating to "CCC" last month, from "B," on a view that any restructuring of the country's massive debt load would count as an effective default.