Moody's

Moody's Investors Service on Tuesday downgraded the long-term deposit and senior debt ratings of five major South African banks.
The banks' ratings were downgraded by one notch to Baa2 (stable) from Baa1 (on review for downgrade).
The affected banks are Standard Bank of SA, Absa, FirstRand, Nedbank and Investec.
According to Moody's, the downgrade were driven primarily by the weakening of the SA government's credit profile, combined with the banks' sizable holdings of sovereign debt securities, which links their creditworthiness to that of the national government.
"To a lesser extent the raging actions were driven by the challenges these banks face in view of weaker economic growth in SA, particularly in the context of consumer affordability pressures and still-high consumer indebtedness that will likely lead to increased credit risks and higher loan impairments for the banks," said Moody's in a statement.
The move came days after the rating agency downgraded South Africa's investment grade credit ratings to "Baa 2 / P-2" from "Baa1 / P-2" -- just one more downgrade above "junk" status.
In August, Moody's downgraded the ratings of Standard Bank, FNB, Nedbank and ABSA and warned of more possible ratings cuts.
After Tuesday's downgrade, Moody's said the banks' ratings could be downgraded if operating conditions worsen more than currently anticipated, leading to significantly higher loan loss provisions that prompt deterioration in the banks' earnings and capital metrics that exceed the rating agency's expectations.
"Although not anticipated, as indicated by the stable outlook on the sovereign rating, any further deterioration in the creditworthiness of South Africa would also exert downward pressure on the banks' ratings, in view of their sizable holdings in sovereign debt securities," said Moody's.
The top five banks' sovereign exposure averages around 135 percent of their capital bases.