April 30 (SeeNews) - Moody's Investors Service on Friday said it downgraded certain covered bonds issued by Greece's Alpha Bank S.A. and EFG Eurobank Ergasias S.A.
Moody's issued a statement in which it also said:
"Moody's Investors Service has today downgraded the following covered bonds issued by Greek banks:
- Mortgage covered bonds issued by Alpha Bank S.A. ("Alpha"): Downgraded to A2 and placed on review for possible further downgrade; previously on 29 April 2010 downgraded to A1 and placed on review for possible further downgrade.
- Mortgage covered bonds issued by EFG Eurobank Ergasias S.A. ("EFG Eurobank") under its first covered bond programme (EUR5 billion Global Covered Bond Programme): Downgraded to A3 and placed on review for possible further downgrade; previously on 29 April 2010 downgraded to A1 and placed on review for possible further downgrade.
- Mortgage covered bonds issued by EFG Eurobank under its second covered bond programme (EUR3 billion Global Covered Bond Programme): Downgraded to A3 and placed on review for possible further downgrade; previously on 29 April 2010 downgraded to A2 and placed on review for possible further downgrade.
These rating actions on the covered bonds were prompted by Moody's rating actions on each of the respective issuer's senior unsecured rating as follows:
- Alpha: Downgraded to Baa3 from A3 and placed on review for possible further downgrade on 30 April 2010;
- EFG Eurobank: Downgraded to Baa3 from A3 and placed on review for possible further downgrade on 30 April 2010.
The rating actions on Alpha Bank and EFG Eurobank were prompted by their weakening stand-alone financial strength and anticipated additional pressures stemming from the country's challenged economic prospects [...].
In the case of Alpha, the combination of an issuer rating of Baa3 and a Timely Payment Indicator (TPI) of "Improbable" assigned to the covered bond programme now cap the covered bond ratings at A2.
In the case of EFG Eurobank, the combination of an issuer rating of Baa3 and a TPI of "Very Improbable" assigned to both covered bond programmes now constrain the covered bond ratings at A3.
In addition, the covered bond ratings for both banks remain on review for possible further downgrade as Moody's is currently reviewing Greece's sovereign ratings and also the senior unsecured ratings of Alpha and EFG Eurobank. [...]"