Moody's downgrades Santander among 28 Spanish banks
26 June 2012
Global ratings agency Moody's Investors Service has cut the ratings of 28 Spanish banks including banking giant Santander, close on the heels of downgrading the debt-struck nation's sovereign ratings to a near-junk status a fortnight ago and slashing the ratings of 16 of its banks last month. (See: Moody's cuts credit ratings of Spanish banks)
The downgrades of the long-term debt and deposit ratings of these banks by one to four notches follow the weakening of the Spanish government's creditworthiness, and lowering of most of these banks' credit assessment, Moody's said in a statement.
The long-term ratings have been lowered by one notch for three banks, by two notches for eleven banks, by three notches for ten banks and four notches for six banks. The short-term ratings for 19 banks have also been downgraded between one and two notches, triggered by the long-term ratings changes.
Spanish banking giant Banco Santander's long-term rating was cut by two notches to Baa2 from A3.
The rating actions reflect the reduced creditworthiness of Spanish sovereign, which affects the government's ability to provide support to ailing banks as well as weighs on bank's standalone credit profiles, Moody's said.
In addition, the bank's exposures to commercial real estate could cause higher losses, raising the need for external support.