Standard and Poor's has classified Greek debt as in "selective default" following the deal it made with creditors to reduce its debts. S&P says the terms of that deal triggered the latest downgrade. Greek debt was already had a "junk" grade rating from the agency. Banks and other financial firms agreed to swap Greek debt for new bonds that were worth much less. Including interest payments, banks took losses of more than 70%. S&P said that when the debt exchange is complete it will assess Greece again and possibly raise the rating to CCC. The agency Fitch made a similar move last week. The Greek government said the move was expected and would not hurt the banking industry. "This rating does not have any impact on the Greek banking system since any likely effect on liquidity has already been dealt with by the Bank of Greece," the finance ministry said in a statement.