| | by OzHouse |
MOODY'S cut the credit ratings of six German banking groups and Austria's three largest lenders yesterday, underscoring that even the eurozone's strongest economies face risks as Europe's debt crisis deepens.
The downgrades to Commerzbank, Germany's second-largest lender, and several smaller German banks, are part of a broad review of financial institutions in the eurozone that has had investors on edge. More downgrades could follow later this month.
Moody's said German lenders faced risks to the quality of their assets if the eurozone crisis worsened or the global economy slowed more, while also noting the relative strength of the German and Austrian economies.
"We wanted to identify vulnerabilities from further potential shocks from the euro area debt crisis and how this would affect investor confidence in institutions across Europe," said Moody's analyst Carola Schuler.
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