Ratings agency Fitch has taken a previously announced action to downgrade a series of European banks, including Slovenia's state-owned NLB and NKBM.
The action comes after EU introduced new rules making it more difficult to prop up banks with taxpayer money in a new crisis.
Fitch withdrew the mark-up for sovereign support for commercial banks across the EU following the implementation of the European bank recovery and resolution directive.
The long-term issuer default ratings on NLB and NKBM were downgraded to 'B+' from 'BB-' with a stable outlook. The banks short-term rating was affirmed at 'B', according to releases from both banks.
At the same time, the agency upgraded the long-term rating of Abanka Vipa, Slovenia's third bank, to 'BB-' from 'B+' and affirmed Banka Koper at 'BBB'.
The viability ratings have been upgraded by one notch to 'bb-' for Abanka and 'b+' for NKBM and NLB and affirmed at 'bb' for Banka Koper, an action that reflects the banks' resilience without external support.
Due to the new European bank directive, Fitch believes banks can no longer rely on support from the taxpayer in case of a crisis. Under new rules the burden of crisis resolution at banks will fall on the shareholders and bondholders.
Source: Slovenia Times
