The International Monetary Fund said today it was suspending financial aid to Greece under its huge rescue programme until a new government is formed after elections slated for late January.
"Discussions with the Greek authorities on the completion of the sixth review of the programme will resume once a new government is in place, in consultation with the European Commission and the European Central Bank," IMF spokesman Gerry Rice said.
Rice however assured that the holdup in the programme would not impact the country's finances in the short term.
"Greece faces no immediate financing needs," he said.
The sixth review of the IMF's four-year, $35 billion loan programme for Greece is part of a much larger joint IMF-European Commission-ECB financial rescue.
It is aimed at ensuring the government is meeting particular budget and reform targets before releasing a new tranche of the loan.
Meanwhile, the European Central Bank said it would seek views from Greek authorities on how to proceed with a review of the country's bailout after lawmakers failed to elect a new president, triggering a snap election.
"It's now for the Greek electorate to decide about the future composition of the parliament and the government. We will not interfere in or comment on this democratic process," the ECB said in a statement.
"We will wait for the views and suggestions of the Greek authorities on how to best proceed with the review, and we will discuss this with the European Commission and the IMF (International Monetary Fund)," it added.
The ECB said Greece had made "impressive progress in stabilising its public finances and reforming its economy over the last years and is expected to return to growth in 2015".
Earlier today Greek lawmakers failed in a third attempt to elect a new president and Prime Minister Antonio Samaras proposed to hold a parliamentary election on January 25.
That sparked concerns that the far-left Syriza party could capture a dominant position in the legislature and roll back tough austerity measures required under the IMF programme.
The EU's economic affairs commissioner Pierre Moscovici has urged Greek voters to back economic reforms as the country headed for snap elections next month that a radical anti-austerity party could win.
"A strong commitment to Europe and broad support among the Greek voters and political leaders for the necessary growth-friendly reform process will be essential for Greece to thrive again within the euro area," Moscovici said in a statement.
"Through this democratic process, the Greek people will once again decide on their future," he added.
Greece, whose dire finances almost destroyed the euro zone in 2012, will hold a general election expected on January 25 after parliament failed today for a third time to elect a new president nominated by Prime Minister Antonis Samaras.
The far-left Syriza party, which leads in opinion polls, has threatened to renegotiate the terms of its European Union-International Monetary Fund bailout if it wins the election - a prospect that has rattled Brussels and the financial markets.
European Commission President Jean-Claude Juncker recently warned Greeks against a "wrong election result", saying that it could see "extreme forces" take power.
Critics said his comments were out of line with the strict neutrality the EU should maintain on member state internal politics.
Moscovici visited Athens earlier this month but did not meet Syriza leader Alexis Tsipras, saying he was there to meet Greek authorities.
Underlining the potential volatility facing markets, the main Athens stock market index accelerated losses to fall 10.7% after the vote, while Greek bond yields jumped above 9%.
The European Union and the International Monetary Fund have overseen two massive international bailouts for Greece after its debt crisis nearly destroyed the single currency zone.
But even after the rescue packages worth €240 billion euros and most of the debt held by private investors being wiped out, the economy has only just begun to recover after six years of contraction.
The reforms required by the creditors have improved the government's finances but have taken a heavy toll on Greeks as unemployment has soared above 27% and many people have had wages and benefits cut.
Greece recently secured a two-month extension from its EU-IMF creditors to conclude an ongoing fiscal audit that will determine the release of some €7 billion in loans. The extension expires in February.
The new Greek crisis emerged just days before Lithuania becomes the 19th member of the single currency zone on January 1.
The European Commission, the EU's executive arm, has this week draped a huge banner over its Brussels headquarters proclaiming "Welcome to the euro area, Lithuania!" complete with giant pictures of one-euro coins and a Lithuanian flag.