Moody's downgrades 3 Austrian banks

Reported by AAP
Wednesday, June 6, 2012

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Moody's has cut its debt rating on Austria's three biggest banks - Erste Bank, Raiffeisen Bank International (RBI) and Bank Austria, an offshoot of Italy's UniCredit group.

The move on Wednesday was largely due to their exposure to the financial crisis in eastern Europe.

The ratings agency said in a statement that Erste Bank and RBI were strongly exposed in eastern Europe, notably in Hungary and Romania, while the downgrade of Bank Austria was justified by the precarious situation of its Italian mother-group.

Erste Bank was downgraded by two notches while the others went down by one notch. Prospects for Erste and Bank Austria were "negative" while RBI was put at "stable".

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