Europe perhaps underestimated how much it needed to reduce Greece's debt burden at its July summit, German Finance Minister Wolfgang Schaeuble was cited as saying by Frankfurter Allgemeine Sonntagszeitung.

"It is possible that we assumed in July a level of debt reduction that was too low," Schaeuble was cited as saying.

Eurozone finance ministers are reviewing the size of the private sector's involvement in a second international bailout package for Greece, the chairman of the Eurogroup ministers Jean-Claude Juncker said earlier this week.

The reassessment could undermine Greece's aid program and hasten the threat of a Greek default.

"There is a high risk that this crisis further escalates and broadens," Schaeuble said.

El-Erian says Greece should seek bigger debt haircut

Greece should ask its bondholders to accept bigger losses than the 21 percent write-down currently foreseen in a deal agreed by EU leaders on July 21, Pimco's co-chief investment officer Mohamed El-Erian told a Greek paper on Saturday.

"Greece must seek a much bigger 'haircut' than 21 percent," El-Erian was quoted as saying in an interview in weekly newspaper Kathimerini. Pimco, which manages $1.2 trillion in assets, is home to the world's largest bond fund.

"The July 21 deal is a start, but it falls well short of what Greece requires to sustain its excessive debt burden and create conditions which will bring it back on a course of viable growth," El-Erian said in the interview.