Moody's lowers Zagrebacka banka notes

Moody's Investors Service said it downgraded to A3 from A2 the unsecured unsubordinated notes issued by Zagrebacka banka maturing in 2009. The outlook is stable.

The agency said this rating action is subsequent to a similar rating action on the bank's parent bank, Unicredito Italiano, which was downgraded to A1 from Aa2 following its successful acquisition of the German HVB group.

Zagrebacka banka's Ba1 foreign currency deposit rating and D+ financial strength rating remain unchanged, Moody's said.

The rating of the notes still pierces Croatia's Baa3 sovereign ceiling for foreign currency debt, the agency noted, adding the level of the rating reflects the high degree of support that Unicredito Italiano, the bank's majority owner, is likely to extend to Zagrebacka banka in case of need.

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