Moody’s has downgraded by one notch top French banks Societe Generale and Credit Agricole while leaving BNP Paribas on negative watch. The agency said that during the review, Moody's concerns about the structural challenges to banks' funding and liquidity profiles increased, in light of worsening of refinancing conditions. Moody's cut SocGen's debt and deposit ratings by one notch to Aa3 from Aa2. The outlook on the long-term debt ratings was negative. For Credit Agricole, Moody's downgraded its BFSR by one notch to C from C+, and cut its long-term debt and deposit ratings by one notch to Aa2 from Aa1.
Credit Agricole and Societe Generale have seen their share prices fall 60% and 65% respectively since February, while BNP has fallen 53% over the same period.
Analysts have welcomed this move as the Moody's rating was slightly elevated compared to other agencies.