Moody’s ups Greek banks

Moody's Investors Service said it upgraded the long-term deposit ratings of Piraeus Bank SA and National Bank of Greece SA to Caa2 from Caa3 and affirmed the Caa3 long-term deposit ratings of Alpha Bank AE, Eurobank Ergasias SA and Attica Bank SA.

The agency also upgraded the long-term counterparty risk assessments of Piraeus Bank and National Bank of Greece to B3(cr) from Caa2(cr), upgraded the counterparty risk assessments of Alpha Bank and Attica Bank to Caa1(cr) from Caa2(cr), and affirmed Eurobank Ergasias’ counterparty risk assessments at Caa2(cr).

The government-guaranteed senior medium-term note program ratings of National Bank of Greece, Alpha Bank and Eurobank Ergasias were also upgraded to provisional B3 from provisional Caa2, in line with Moody's recent action on Greece.

Concurrently, Moody's affirmed the baseline credit assessment of Piraeus Bank, National Bank of Greece, Alpha Bank and Eurobank Ergasias at caa2 and that of Attica Bank at caa3.

The outlook on the deposit ratings of National Bank of Greece and of Alpha Bank was maintained at positive, while the outlook on the deposits ratings of Piraeus Bank, Eurobank Ergasias and Attica Bank was maintained at stable.

Moody’s said the upgrades are primarily driven by banks' expansion of their pool of unsecured liabilities available to absorb losses in a potential bank resolution scenario. Accordingly, the agency's Loss Given Failure analysis of banks' liability structure led to the rating upgrades, reflecting the potentially lower losses that unsecured senior creditors could face, the agency explained.

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