"Fitch Ratings has downgraded National Bank of Greece's, Efg Eurobank Ergasias', Alpha Bank's, Piraeus Bank's and Agricultural Bank of Greece's Long-term Issuer Default Ratings (IDR) and Support Rating Floors (SRF) to 'CCC' from 'B-' and Short-term IDRs to 'C' from 'B'," the official statement says.
The reason is the concerns over the market about the exit of Greece from the Eurozone after June 17 elections. "An exit of Greece from EMU would be probable and/or this could be followed by a withdrawal of international support to Greek banks," Fitch says and adds that "a Greek exit would likely result in widespread default on private sector as well as sovereign euro-denominated obligations."
Troika has been supporting Greek government and Greek Bank, "However, such support has not yet been transferred to the banks and further capital injections will be needed to reach the minimum 9% core capital ratio required by the Bank of Greece by September 2012. "
And as far as "the Bank of Greece and the ECB have continued to provide emergency liquidity assistance" to banks, the solvency of the Greek banks is on risk.
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