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Fitch downgrades five Slovenian banks over delayed measures

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(Globalpost/GlobalPost)

The Fitch ratings agency downgraded on Friday five Slovenian banks, including the two largest NLB and NKBM, citing the delay in the implementation of a solution for the eurozone country's wobbly banking system.

The country's two largest banks, state owned Nova Ljubljanska Banka (NLB) and Nova Kreditna Banka Maribor (NKBM), saw their rating downgraded to BB- from BBB- rating with a negative outlook.

"The downgrade reflects continuing delays in the crystallisation and implementation of a clear and decisive solution of the problems in the Slovenian banking sector," Fitch said, adding the banks' asset quality had further deteriorated since last year's review.

Fitch also downgraded another three Slovenian banks, Banka Celje, Gorenjska Banka and Probanka, while keeping unchanged the rating of the country's third-largest bank Abanka (B-) and Italy's Intesa Sanpaolo subsidiary Banka Koper at BB.

Fitch estimated the country's three largest banks together would require a 2 billion euros ($2.6 billion) injection of fresh capital this year.

Slovenia, once a model EU entrant, has struggled against economic recession and problems facing its banks, which are mired in bad debt, prompting concerns that it might be the next eurozone member to seek a bailout from the EU and IMF.

bk/bm

http://www.globalpost.com/dispatch/news/afp/130405/fitch-downgrades-five-slovenian-banks-over-delayed-measures