PARIS (dpa-AFX) - Standard & Poor's said Friday that it has reviewed the five largest French banks in light of more difficult economic and funding market conditions, and that it was lowering its long-term counterparty credit rating on BNP Paribas to 'AA-' from 'AA'.
The rating agency affirmed its 'A+/A-1' counterparty credit ratings on BPCE, Credit Agricole S.A., Caisse Centrale du Credit Mutuel, Banque Federative du Credit Mutuel and Societe Generale. However, S&P lowered the stand-alone credit profiles, or SACPs, on the banks by one notch to 'a'.
The outlook on all five banks is stable.
The rating action follows the downward revision of S&P's Banking Industry Country Risk Assessment, or BICRA, for France to Group 2 from Group 1.
S&P also said it sees lower earnings prospects for all those five banks due to the more difficult environment and higher funding costs.
'Funding market dislocations and negative market sentiment have revealed that the funding and liquidity profiles of the five banks are more vulnerable than we had thought,' S&P said in a statement.
'In our view, we see weaker economic prospects for Europe, including the peripheral countries to which some French banks are significantly exposed,' the rating agency added.
Fitch Ratings on Thursday put the ratings of BNP, Credit Agricole and SocGen on 'rating watch negative'. Last month, Moody's downgraded SocGen and Credit Agricole while it left BNP on review.
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