Moody’s downgrades deposit rating of Irish banks to junk status

INTERNATIONAL credit rating agency Moody’s Investors Service has downgraded the long- term deposit ratings of Ireland’s government-protected banks — effectively classifying them as junk status, or non-investment grade.

Yesterday’s move on AIB, Bank of Ireland, the EBS Building Society, Irish Life & Permanent (IL&P) and ICS Building Society follows Moody’s lowering of Government bond ratings by two notches (from BAA3 down to BAA1) to just above junk status on Friday.

Moody’s rival Fitch Ratings has, meanwhile, called Ireland’s solvency rating “fragile”, adding that an improvement in the country’s debt situation depends on economic growth and the success of the Government’s four-year economic plan.