AUSTRALIA’S FOUR LARGEST banks have had their credit rating downgraded by agency Standard and Poor’s.
ANZ, Commonwealth Bank, National Australia Bank and Westpac all suffered a rating cut of one notch, bringing them to AA- from their previous AA rating, reports Businessweek. It is the fourth-highest rating on the agency’s scale.
S&P said the decision was based on the cost posed by sourcing cash from overseas markets and the country’s foreign debt.
Following the crash of Lehman Brothers in 2008, which S&P failed to foresee, the agency revised its rating criteria – and it is in the context of these new considerations that the banks were downgraded, reports The Australian.
Meanwhile, rival rating agency Moody’s said it would keep the banks on their AA rating and retain their outlook as positive.
Experts have warned that a continuing European debt crisis could expose the banks to a further downgrade.