Fitch downgrades Italy's biggest bank

Fitch Ratings has downgraded its rating on Italy's biggest bank UniCredit SpA, with the latter's long-term issuer default rating (IDR) cut from "A" to "A-," and short-term IDR from "F1" to "F2," according to media reports on Tuesday.

Fitch also put the ratings on "watch negative," meaning it may further downgrade them in the near future, Reuters reported.

Meanwhile, the international ratings agency also warned of possible rating cuts on seven more banks in Italy, five in France and eight in Spain.

Fitch said in a statement that the downgrade reflected fundamental challenges facing many banks globally, particularly in Europe.

The seven Italian banks put on "watch negative" by Fitch include the country's largest retail lender Intesa Sanpaolo, the country's third-biggest lender Banca Monte dei Paschi di Siena and UBI Banca.

In France, ratings outlook of Societe Generale, Groupe BPCE, Dexia Credit Local and La Banque Postale has been lowered to "negative" from "stable."

In Spain, the eight banks on "watch negative" include Banco Santander, Banco Bilbao Vizcaya Argentaria and CaixaBank SA.

The move followed Fitch's decision last week to cut the outlook on France's AAA sovereign rating to "negative," and its recent change to "watch negative" on the sovereign ratings of Italy, Belgium, Spain, Slovenia, Ireland and Cyprus.


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