May 12, 2012 at 9:09 AM ET
ATHENS -- Greek politicians abandoned their quest to form a government on Saturday, leaving the president with one final opportunity to avert new elections that could drive the debt-choked country out of the European single currency.
Greece's political landscape is in disarray after voters humiliated the only parties backing a rescue plan tied to spending cuts, leaving no bloc with sufficient seats to form a government to secure the next tranche of financial aid.
Without aid from the EU and IMF, the country risks bankruptcy in weeks and - as European leaders now openly acknowledge - potential ejection from the eurozone.
On Saturday morning, Socialist leader Evangelos Venizelos met President Karolos Papoulias in the presidential mansion to formally confirm he had been unable to persuade other parties to form a broad coalition that would keep the bailout agreement but try to improve its terms.
The holdout was Alexis Tsipras, a charismatic 37-year-old radical leftist, who has emerged as the standard bearer for opponents of the bailout's harsh austerity measures and has the most to gain from a new election.
In a last-ditch effort to broker a deal for a coalition government, President Papoulias called the leaders of Greece's political parties to meetings on Sunday.
Papoulias' office announced Saturday that the president would meet initially with the heads of the three parties that won the most votes in Sunday's inconclusive elections — the conservative New Democracy, radical left-wing Syriza and socialist PASOK. He will then meet individually with the leaders of the other four parties that won enough votes for parliamentary seats.
If Papoulias fails to broker a coalition agreement, Greece will have to hold new elections next month.
In televised remarks during their meeting Saturday, Venizelos urged the president to lean on Tsipras to join an "ecumenical government".
"I put this forth to Mr Tsipras. I haven't received a positive response," Venizelos said. "I believe that is where your efforts should be focused during the consultations."
The president replied: "There are signs of optimism in what you are telling me and I hope I can contribute to the formation of a government - because things are rather difficult."
Papoulias will meet the leaders of the three parties on Sunday at 0900 GMT, his office said in a statement.
The lurch toward a new election has caused havoc in financial markets, both in Greece and across Europe, where the prospect of Athens leaving the euro is viewed as a risk for bank balance sheets and the credit ratings of other vulnerable countries, although the EU is better prepared than it was a few months ago.
On Friday, as politicians acknowledged their failure to agree a coalition, the euro sank to its lowest point since January near $1.29.
Opinion polls conducted in the week since the election show Tsipras's SYRIZA coalition surging into first place - a prize that would give it an automatic bonus of 50 extra seats in the 300 seat house at the expense of the conservatives.
Tsipras says the bailout deal must be torn up, though like most Greeks he says he wants to keep the euro, a position seen in Brussels as untenable without the bailout.
The Associated Press and Reuters contributed to this report.