Standard & Poor’s has warned that an exit by Greece from the eurozone would possibly lead PPC, the Public Power Corporation, to bankruptcy. The US financial services company has downgraded the power utility’s credit rating to B- from B, citing serious cash flow problems.

In its report, Standard & Poor’s highlighted that PPC would find itself under even greater cash flow pressure if the country’s economic conditions did not quickly improve.

Standard & Poor’s noted that it would be closely monitoring the Greek government’s ongoing negotiations with the country’s creditors as it believes PPC’s rating may need to be revised depending on the outcome of these talks.

Based on PPC cashflow data for the first nine-month period in 2014, Standard & Poor’s noted that the utility’s inflow included 330 million euros in available liquidity, one billion euros in loans, of which 455 million euros were provided by the European Investment Bank – 220 million euros for PPC, and 235 million euros for its subsidiary firm IPTO, Independent Power Transmission Operator – and 625 million euros were provided by a consortium of German banks, led by development bank KfW, for an electricity production station, Ptolemaida 5, in northern Greece. Also listed in PPC’s inflow data was 900 million euros linked to Funds From Operation (FFO).

As for PPC’s outflow for the nine-month period in 2014, Standard & Poor’s listed 650 million euros in maturing loans, 700 million euros in fixed investment costs, and 200 million euros from an increase in working capital needs.