MSCI (NYSE: MSCI),the company behind major global equity benchmarks such as the MSCI Emerging Markets Index, is mulling severe repudiation of Greece as the Eurozone nation teeters on the brink of financial ruin.

In November 2013, MSCI demoted Greece to emerging markets status from the developed market classification. Now, the index provider is mulling a demotion that would send Greece to the ominous “standalone” market classification. Assuming MSCI moves forward with such a demotion, that means Greek stocks would be expelled from the MSCI Emerging Markets Index and the iShares MSCI Emerging Markets ETF (NYSEArca: EEM), skip over the iShares MSCI Frontier 100 ETF (NYSEArca: FM) and head straight to standalone status. [Greece Gets Another Emerging Markets Demotion]

In 2013, MSCI was the third index provider to demote Greece to emerging markets status, following Russell Investments and S&P Dow Jones Indices. Greek stocks are one of the smallest weights in EEM and the MSCI Emerging Markets Index. iShares shows Chile at a weight of 1.21% and “other” countries at 3.94%. Greece falls in the “other” category.

Athens’ standoff with the European Union (EU) and the International Monetary Fund (IMF) heads to a dangerous and uncharted new level following a July 5 referendum that was called by Prime Minister Alexis Tsipras on whether to accept austerity in exchange for a European bailout. As Greece appears to be headed for default, its government has ordered the closure of the stock market and banks until at least after July 5. Also capital controls have been put in place to prevent a run on banks,” reports Emerging Equity.

Shares of the Global X FTSE Greece 20 ETF (NYSEArca: GREK), the only Greece-specific ETF trading in the U.S., are of nearly 17% today as the ETF is heading toward its worst intraday performance since debuting in December 2011. Adding to the calamity in Greece, regulators there closed the country’s equity market today and have imposed a 60-euro withdrawal limit from Greek banks. [Greek Drama Sends ETF Tumbling]

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