Moody's cuts Krung Thai Bank view to negative

Moody's Investors Service said it changed to negative from stable the outlook on Krung Thai Bank's D- bank financial strength rating, A3/prime-1 local-currency deposit ratings and the Baa3 rating for its preferred stock. The bank's prime-2 short-term foreign-currency deposit rating was unaffected.

The action was prompted by concerns over the direction of asset quality at the bank in light of the deteriorating economic and political environment in Thailand, Moody's said.

The agency also said it cautions that the economic downturn, which is already well underway, is now likely to be worse than anticipated and greater asset quality problems will gradually emerge.

Additional concerns relate to the bank's high single-borrower concentration and low capitalization, Moody's added.

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