Diversity limits EU banks’ risks

JEANNE-Francoise de Polignac, president of Standard & Poor’s Paris office, made the following comments in an interview with Bloomberg Television yesterday: “European banks have the advantage of being extremely diversified and not being exposed to a single type of risk.

“Banks that are most exposed to real estate like Irish, English or Spanish banks are more vulnerable and might see their credit quality decline in coming months. It’s likely that the trend of rating increases is over and there might be some negative outlook on ratings of banks because they are the first to undergo the fallout of the crisis, UBS in particular.”