Moody’s has placed France’s top three banks – BNP Paribas, Societe Generale and Credit Agricole – on review for a possible downgrade of their credit ratings because of their exposure to Greece’s debt crisis.
Societe Generale is the most at risk – potentially facing a downgrade of as much as two rating notches.
Moody’s also said it may take similar actions on other banks with direct exposures to Greece in the coming weeks.
France’s banks have $65 billion (45.5 billion euros) in overall net exposure to Greece, versus $40 billion (28 billion euros) for Germany and $41 billion (28.7 billion euros) for the United States, according to the Bank for International Settlements.
“Today’s actions reflect Moody’s concerns about these banks’ exposures to the Greek economy, either through direct holdings of government bonds or credit extended to the Greek private sector directly or through subsidiaries operating in Greece, a key factor for CASA and SocGen due to their local Greek banks,” Moody’s said in a note.
Euro zone ministers failed on Tuesday to reach agreement on how private holders of Greek debt should share the costs of a new bailout, putting the onus on the leaders of Germany and France to forge a deal later this week.
The ratings review helped pull down the euro against the dollar and the Swiss franc.