S&P downgrades 7 Spanish large banks

MADRID - Agence France-Presse

S&P downgraded Spain’s Santander Bank two notches from A- to BBB.

Standard & Poor’s rating agency cut the credit ratings of seven Spanish banks including the two largest, Santander and BBVA, after having downgraded Spain’s sovereign debt.

Banks that suffered in the downgrade late on Tuesday were Santander, BBVA, Banesto, Banco Popular, Bankia-BFA, Banco Sabadell and CaixaBank, the New York-based rating agency said in a statement.
Standard & Poor’s axed Spain’s sovereign credit rating by two notches on October 10, leaving its bonds just one level above speculative, or junk-bond, status.

Rival agency Moody’s Investors Service already has Spain’s debt on a similar rating and is expected to announce this month whether it will cut the rating again, assessing Spanish bonds as junk.

Such a move could send Spanish borrowing rates spiraling and rapidly force the country to seek a sovereign bailout.

Standard & Poor’s downgraded the debt of Santander and its Banesto subsidiary by two notches to BBB from A- and BBVA by two notches to BBB- from BBB+.