S&P downgrades world's oldest bank to junk status; Greece Downgraded to 'Selective Default'Submitted by go213mph on Thu, 12/06/2012 - 21:13
Standard & Poor's on Wednesday cut its credit rating for troubled Italian bank Monte dei Paschi di Siena -- the world's oldest surviving lender -- to speculative-grade status of BB+ from BBB-.
The ratings agency said it was also placing the bank on negative outlook.
"Deteriorating trends in Banca Monte dei Paschi di Siena's financial position make it unlikely that the bank would restore profitability and improve its capital and funding position in line with our previous expectations.
Standard & Poor's on Wednesday cut Greece's sovereign long-term foreign currency credit rating to "selective default" from an already low "CCC" rating.
Last week Greece and its international lenders reached a deal to lower the country's debt burden, which included a debt buyback.
The decision to lower the sovereign rating follows the government's invitation to private sector bondholders to participate in the debt buyback "which under our criteria we view as a selective default," S&P said in an e-mailed statement.