"Following delays in implementing budgetary consolidation measures and a worsening Greek economy, we believe Greece is likely to require additional financing for 2012 under the EU/International Monetary Fund (IMF) program," S&P said in a statement.

"We are revising the outlook on the long-term ratings on Greece to negative, reflecting the possibility of a downgrade if Greece fails to secure the next disbursement of the EU/IMF Program," S&P said.

Greece has made progress in finding budget cuts needed to continue its bailout program, but international inspectors said this week that they will return in September to see if the remaining work is done.

Greece has pledged a series of fiscal and reform measures worth 11.5 billion euros to convince international lenders to keep Athens hooked to a 130 billion euro lifeline and avoid bankruptcy.

Inspectors from the IMF, the European Commission and the European Central Bank - known as the troika - concluded a visit to Greece on Sunday saying the talks with the new coalition government were productive.

"We see the likelihood of shortfalls, owing to election-related delays in the implementation of budgetary consolidation measures for the current year, as well as the worsening trajectory of the Greek economy," S&P said.

The ratings agency said it sees the Greek economy shrinking by 10 percent to 11 percent, cumulatively, during 2012-2013.

S&P also affirmed Greece's CCC rating, which is already well in speculative territory.

Moody's Investors Service rates Greece C, and Fitch rates the country CCC.

(Reporting By Pam Niimi and Luciana Lopez; Editing by Stacey Joyce and Leslie Adler)

• A Permanent Economic Emergency