S&P downgrades 7 Italian banks

ap-yahoo

ROME (AP) — Standard & Poor's said Wednesday that it had downgraded seven Italian banks because of sovereign debt risk, a day after the agency downgraded Italy's credit rating.

The cut targeted leading banks Mediobanca SpA and Intesa Sanpaolo SpA, as well as Findomestic Banca SpA, Banca IMI SpA, Banca Nazionale del Lavoro SpA, Banca Infrastrutture Innovazione e Sviluppo SpA and Cassa di Risparmio in Bologna SpA.

The agency said it was assigning negative outlooks to the long-term ratings on these seven banks. It was also revising its outlooks from stable to negative on eight other Italian banks, including Unicredit.

"The negative outlooks on the long-term ratings on the 15 banks reflect the possibility that we could lower their ratings, all other things being equal, should we further lower our ratings on the Republic of Italy," S&P said in a statement.

***Furthermore ING announced it slashed large chunks of Italian and Spanish state bonds***

Italian lenders’ non-performing loans rose 1.3 percent in July from June, the country’s banking association ABI said.

Non-performing loans increased to 99 billion euros ($135 billion), ABI said in an e-mailed statement today. Impairments, excluding writedowns, rose to 53.5 billion euros, according to the report.