French banks face downgrade threat
There are fears that France's three largest banks may have their credit ratings cut this week by ratings agency Moody's, according to reports over the weekend.
Bloomberg and Reuters both reported that BNP Paribas, Société Générale and Crédit Agricole were all under threat due to high levels of exposure to Greek debt.
"The decision is imminent," one Paris-based source quoted by Reuters said. "It will probably be a downgrade but it's not certain yet."
Moody's put the banks' ratings first under review in June, citing "the potential for inconsistency between the impact of a possible Greek default or restructuring and current rating levels."
Share prices of the three banks have tumbled in recent months. Société Générale has fallen 55 percent since June 15th while Crédit Agricole has fallen 45 percent and BNP Paribas 42 percent.
G7 finance ministers were meeting yesterday in Marseille where they pledged to support banks. A statement said countries would take "all necessary actions to ensure the resilience of banking systems and financial markets."
In an apparent fightback on Monday morning, Société Générale announced that it was implementing a new wave of cuts and job losses.
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