Business News
Commerzbank shares slump after Moody's downgrade
Jan 18, 2012, 14:20 GMT
Frankfurt - Shares in Commerzbank slumped by more than 5 per cent Wednesday after Moody's Investors Service cut the financial rating of Germany's second biggest bank.
The US-based rating agency said it had downgraded the ratings of the Frankfurt-based Commerzbank to D plus, from C minus, amid worries that the bank's troubled mortgage arm Eurohypo would require long-term support.
Moody's cut Eurohypo's rating to E plus, from D minus, with Moody's warning: 'The deteriorating euro area sovereign debt markets imply that Eurohypo will likely require support for an extended period.
'Given its inadequate economic capital and lack of market access for unsecured long-term funds, Moody's believes that Eurohypo - as a standalone bank - could not weather a further weakening of the yet-unresolved euro area debt crisis,' Moody's said.
By late afternoon trading, Commerzbank shares retraced earlier losses, but were down 2.8 per cent at 1.40 euros (1.80 dollars).
COMMENT
blog comments powered by DisqusLatest Headlines in Business
- 1. US unemployment drops further, but figures disappoint
- 2. Japan stocks down as euro debt outweighs positive US data
- 3. Iraq resumes oil flow after pipeline blast in Turkey
- 4. Spanish bond auction lifts eurozone worries, sinks Japan stocks
- 5. ECB holds rates, rules out early exit from emergency measures
Older Talkback
