Bloomberg News

Moody’s May Cut Ratings of E.Europe Units of Erste, KBC, SocGen

February 22, 2012

Feb. 21 (Bloomberg) -- Moody’s Investors Service today placed on review for downgrade the standalone credit assessments of seven bank subsidiaries located in eastern Europe, “reflecting the potential adverse consequences from weakening creditworthiness at the parent level on the subsidiaries’ financial strength, given the close linkages between them.”

“Such linkages include the risk that subsidiaries may face pressure to upstream capital to their parents or to take more risks in order to increase profits,” according to a report by Moody’s analysts Irakli Pipia and Yves Lemay.

The ratings of Banco Comercial Portugues SA’s Polish unit, of Erste Group Bank AG’s Romanian and Czech units, of the Czech units of KBC Groep NV and Societe Generale SA and of Raiffeisen Bank International AG’s Romanian and Slovak units may be cut, the rating’s company said in the report.

The debt and deposit ratings of these subsidiaries and of 14 other units of western banks in eastern Europe also were put on review for downgrade, the analysts said.

The announcement “follows the placement on review for downgrade of the affected subsidiaries’ parent groups, specifically eleven European banking groups and one U.S. group” on Feb. 15, Moody’s said.

Link to Statement:{NSN LZRGL43PWT1E <GO>}

To contact the editor responsible for this story: Zoe Schneeweiss at zschneeweiss@bloomberg.net


The Good Business Issue
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus