Moody's downgrades five Dutch banks

Moody's Investors Service has downgraded five Dutch banks, four of them by two notches, and warned a Greek exit of the euro would see further cuts.
The move kicks off a long-awaited round of downgrades for major European institutions.

Moody's set a stable outlook to the ratings for four of the groups but kept a negative outlook for ING Bank, meaning it could cut it again.

The downgrades will only add to pressure on European leaders to sort out the region's debt crisis, with a real test to the union coming this weekend as Greeks go to the polls. Moody's also warned that, were Greece to exit the euro, further ratings actions on European banks could well be needed.

The long-expected news had little immediate impact on financial markets in Asia, with the euro holding firm around $1.2616.  "Today's actions reflect Moody's view that Dutch banks will face difficult operating conditions throughout 2012 and possibly beyond," Moody's said in a statement.

Moody's agency said it had cut the ratings by two notches to Aa2 for Rabobank Nederland, to A2 for ING and ABN Amro, and to Baa2 for LeasePlan Corporation.

EU-Digest