Moody’s cuts Salvadoran banks

Moody's Investors Service said it downgraded the long-term foreign currency issuer rating of Banco de Desarrollo de El Salvador (Bandesal) to Caa1 from B3.

At the same time, the agency downgraded the long-term foreign currency deposit rating of Banco Agricola, SA and the long-term foreign currency senior unsecured debt rating of Agricola Senior Trust (AST) to B2 from B1. AST is a Cayman Islands-based trust unconditionally and irrevocably guaranteed by Banco Agricola. Banco Agricola's long-term counterparty risk assessment was also downgraded to B2(cr) from B1(cr).

The deposit and issuer ratings carry stable outlooks.

In addition, both banks' standalone baseline credit assessments (BCA) were downgraded to caa1 from b3.

Moody’s said the actions follow the April 13 downgrade of El Salvador's government bond rating to Caa1 from B3 with the outlook changed to stable from negative.

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