Moody΄s Investors Service on Tuesday cut the credit ratings on two Cypriot banks and put another on review for a downgrade, citing the increased risks of a possible Greek exit from the euro zone. Bank of Cyprus, the largest lender on the Mediterranean island, had its deposit and senior unsecured debt ratings cut by one notch to B2 from B1 and the stand-alone credit assessment lowered to B3 from B2.
Moody΄s also cut Hellenic Bank Ltd’s deposit ratings by one notch to B1 from Ba3 and the stand-alone credit assessment lowered to B2 from B1.
Both banks were also put on review for a possible further downgrade, Reuters reported.
Cyprus Popular Bank, the country΄s second-largest lender, was also put on review for a downgrade.
“Although a Greek exit is not Moody΄s central scenario, the rating agency says that it considers the risk of a euro exit by Greece as substantial and recognizes that the probability of such an outcome may become more likely following the Greek parliamentary elections on June 17th,” Moody΄s informed in a statement.
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