Italian Debt Crisis: S&P Downgrades 15 Italian Financial Institutions

HJ: Anyone closely following the European Debt Crisis saw this one coming from a mile away.  Italy is a ‘major straw on the camels back’.  With Spain on the verge of requesting a bailout and Italy soon to join the club, the question is how much longer can the ECB extend this charade?  - Truth

S&P Downgrades 15 Italian Financial Institutions, Says Country Faces Deeper Recession Than Previously Thought

By Tyler Durden on 08/03/2012 15:38 -0400

It is late in the afternoon on a Friday, which means one thing: it is time to dump all left over bad news under the rug. Sure enough, here comes S&P. From Bloomberg:

  • S&P CUTS RATINGS ON 15 ITALIAN FINL INSTITUTIONS
  • S&P TAKES RATING ACTIONS ON 32 ITALIAN FINL INSTITUTIONS
  • BANCA MONTE DEI PASCHI DI SIENA SPA CUT TO BBB-/NEGATIVE/A-3
  • BANCA POPOLARE DI MILANO SCRL CUT TO BB+/NEGATIVE/B BY S&P
  • S&P SEES ITALIAN BANKS’ VULNERABILITY TO CREDIT RISK RISING
  • S&P SAYS ITALY FACES POTENTIAL DEEPER RECESSION THAN IT THOUGHT

Full release:

Standard & Poor’s Ratings Services today said it has taken rating actions on 32 Italian financial institutions.

These include affirming our counterparty credit ratings on 15 entities,  lowering our ratings on 15, removing the ratings on four from CreditWatch  negative, and revising the outlook on one.

The rating actions reflect our view of increased credit risk for the Italian  economy and its banks. They follow our revision of our economic risk score for  Italy, one of the main components of our Banking Industry Country Risk Assessment (BICRA), to ’5′ from ’4′. We have maintained our BICRA for Italy at group ’4′ and our industry risk score at ’4′ (see “BICRA On Italy Maintained
At Group ’4′, Economic Risk Score Revised To ’5′ On Increased Credit Risk For Italian Banks,” published Aug. 3, 2012, on RatingsDirect on the Global Credit Portal).

Read the rest of the article here: Zero Hedge 


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