Moody’s downgrades senior debt at five Irish banks and building societies

INTERNATIONAL credit ratings agency Moody’s has downgraded the senior debt levels of Irish banks that are not secured by the Government here, on concerns that senior bondholders will have to share the cost of bailing out our banking system.

Yesterday’s downgrade covers senior debt owned by AIB, Bank of Ireland, Anglo Irish Bank, the Irish Nationwide Building Society (INBS) and EBS Building Society. Between them, the five institutions have €15.2 billion in senior unsecured debt. Of that, AIB accounts for €5.8bn, Bank of Ireland for €5.2bn, Anglo Irish Bank €3.1bn, the EBS €500m and INBS €630m.

Moody’s has cut AIB’s relevant debt rating from ‘Baa3’ to ‘Ba2’; Bank of Ireland’s from ‘Baa2’ to ‘Ba1’; Anglo’s rating from ‘Ba3’ to ‘Caa1’; INBS from ‘Ba3’ to ‘Caa1’ and the EBS from ‘Baa3’ to ‘Ba2’. The agency also cut its debt rating for Irish Life & Permanent (IL&P) — the only non- NAMA-related entity of the relevant Irish banks — from ‘Baa3’ to ‘Ba2’.