A 26-page report, classified as confidential, was sent to the Finance Ministry shortly before Christmas by Greece’s international lenders. Sources say the report highlights concerns about challenges faced by the economy and the domestic banking system in 2011 and concludes that measures outlined by the so-called memorandum signed with the European Union and the International Monetary Fund – even if adopted – are not enough to convince markets and bring about growth in the second half of the year. At the start of December, officials from the Institute of International Finance, a bank association with some 400 members, visited Athens. They met with Finance Ministry officials and key state bodies in order to be informed firsthand about the economy. The report, which is of particular importance as it reflects the opinion of those that hold Greek debt, highlights that concerns about the economy will not ease in the medium term unless steeper spending cuts or faster privatizations are completed than goals set out in the memorandum. At the same time, they want to see some signs of stabilization in economic activity and the labor market. Despite the fact that progress is being recognized on the reform and fiscal adjustment front, foreign banks believe that tough times lie ahead for the Greek economy for the following reasons: Growth cannot return quickly due to structural problems, the current account deficit remains very large, the domestic banking system remains reliant on cash injections from the European Central Bank, and revenue and spending goals set out in the memorandum are being missed. For these reasons, faster fiscal adjustment is being called for along with the speedier execution of the state asset sell-off plan.