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.

"/> 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.

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SOCIÉTÉ GÉNÉRALE

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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SOCIÉTÉ GÉNÉRALE

France’s Societe Generale to cut 1,500 jobs: report

French banking group Societe Generale is planning to cut 1,500 positions in its BFI corporate and investment banking arm, Le Figaro newspaper reported on Saturday.

France's Societe Generale to cut 1,500 jobs: report
Societe Generale CEO Frederic Oudea at the Climate Finance Day and Global Roundtable in Paris on November 26, 2018. Photo: ERIC PIERMONT / AFP
Citing internal bank documents, the paper said the bank was looking at two scenarios, both of which envisage 1,500 job cuts worldwide, with around 700 of them in France.
 
The company said in a statement on Saturday it was still reviewing activities in its corporate and investor client business so it was not possible to comment on the impact on jobs.
 
“We have an ongoing dialogue with our unions and will consult them on our projects and their impact as soon as the review is completed in the coming weeks,” the bank said.
 
French CGT union representative Philippe Fournil could not confirm the information, but said the bank's management had on Thursday indicated it was still reviewing activities within that business.