Deutsche Bank AG : Moody's downgrades Deutsche Postbank's ratings
06/22/2012| 06:05pm US/Eastern
Moody's Investors Service on Friday cut Deutsche Postbank's long-term senior debt and deposit ratings by one notch, following on a sweeping downgrade of global banks the previous day.
The credit ratings agency cut Deutsche Postbank AG to A2 with a stable outlook from A1, noting in a statement "tail risks associated with the bank's still-large non-core asset exposures" and the bank's moderate capitalization.
The move on Postbank came a day after Moody's downgraded 15 of the world's biggest banks to reflect the risk of losses they face from volatile capital markets activities.
That included a cut to Deutsche Bank, Postbank's parent, to A2.
But Moody's noted some factors that limited the extent of Friday's downgrade, such as relatively stable core earnings capacity, robust liquidity and funding structure and the "very high probability" of support from Deutsche Bank.
The stable outlook "captures Moody's view that the currently foreseen risks to creditors are now reflected in these ratings," the statement read.
"Nevertheless, negative rating momentum could develop if conditions deteriorate beyond the rating agency's current expectations," it said.
(Reporting by Luciana Lopez)