Ratings agency Moody's downgraded the debt of BNP Paribas
Moody's cut its ratings on the long-term debt of BNP and Credit Agicole by one notch to Aa3, concluding reviews that began in June and were continued in September. Societe Generale's long-term debt was cut by one notch to A1.
The downgrades were driven by the increasing difficulties the banks were having in raising funding and the worsening economic outlook, Moody's said. But Moody's said its ratings did take into account the fact that all three banks were likely to benefit from state support if the crisis deepened.
Liquidity and funding conditions have deteriorated significantly for
The probability that the
All three of the banks have undertaken programmes to sell assets to reduce their reliance on outside funding, but Moody's said that since many European banks were doing the same thing such asset sales might not generate as much money as the banks hoped.
(Reporting by Leila Abboud, James Regan; Editing by David Cowell)