Advertisement Opportunities | About Us | Contact Us | Tell us what you think | Jobs | Shopping | Scandinavian Dating | Archive


 

Weather Forecast




Regional News




Business Videos






Credit rating of Scores of Spanish banks Downgraded by Moody’s ushering more pain to the ailing euro-zone economies


Thursday, 17 May 2012
Moody’s Investors Service downgraded 16 of Spain’s leading lenders including Banco Santander SA (SAN) and Banco Bilbao Vizcaya Argentaria SA (BBVA), Spain’s biggest banks, cut three levels blamed on recession in the country and mounting loan losses. Santander’s U.K. - based subsidiary also was cut.
"The change to Moody's credit rating of Santander UK plc has no impact on our businesses in the UK or our plans for future growth," Andy Smith, a spokesman at Santander said about the downgrade to the BBC.
"Santander UK plc is an autonomous subsidiary of the Santander Group, with more than 90 percent of its total assets held in the UK and a eurozone sovereign exposure of less than 1 percent of assets."
On the whole, nine banks were cut three notches and seven kept under review for further reductions, the ratings firm said today in a statement.

The downgrades came after 26 Italian banks were dropped by Moody’s on May 14 while on Feb. 13 it cut Spain’s sovereign debt. The main drivers for the Spanish bank downgrades today are a surge in soured loans, the recession, restricted funding access and the reduced ability of the government to support lenders as its own creditworthiness diminishes, Moody’s said.
Moody's point on the "adverse operating conditions, characterised by the renewed recession, the ongoing real-estate crisis and persistent high levels of unemployment"

“Banks will continue to face highly adverse operating and market funding conditions that pose a threat to their creditworthiness,” the ratings firm said. “The Spanish economy has fallen back into recession in first-quarter 2012, and Moody’s does not expect conditions to improve” this year.

The government on May 9 took over the Bankia (BKIA) group, the lender with the biggest Spanish asset base after it filed 2011 earnings without certification from auditors. Deputy Economy Minister Fernando Jimenez Latorre today denied deposits were leaking from Bankia after El Mundo newspaper reported that 1 billion euros had been withdrawn by customers since May 9. Bankia’s newly appointed chairman, Jose Ignacio Goirigolzarri, said today that the bank’s activity had been “basically normal” in recent days, reports Bloomberg News.
The ratings for Italian banks are now amongst the lowest within advanced European countries, reflecting these banks' susceptibility to the adverse operating environments in Italy and Europe," Moody's said in a statement.
"Banks are vulnerable to the renewed recession in Italy, given their already elevated levels of problem loans and weakened profitability," it added.
By Scancomark.se Team












Front Page |Scandinavia Today| Market News |Companies News | Competitiveness |Political Economy


About Us | Contact Us | Terms and Conditions |Copyright Policy | Privacy Policy

Scandinavian Companies & Market Magazine 2012
 

Back to top