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Moody's To Junk Spanish Banking System In Hours

Tyler Durden's picture





 

Nearly two weeks ago we penned "These Three Spanish Banks Will Be Downgraded Tomorrow" which showed which banks had a rating higher than the sovereign following Moody's long overdue Spanish downgrade, and thus were about to be downgraded by many notches. Today, after a ridiculously long delay whose only purpose was to buy time, Moody's is about to junk virtually the entire Spanish banking sector, as was widely expected.The downgrade is expected to happen within hours.

From Expansion (google translated)

After cutting the rating of Baa3 and Spain to threaten to put Spanish debt at the level of junk bond no later than 30 days, has reviewed the notes of all banks. "We have reported a reduction of two or three notches (steps) to almost everyone. Do not look at individual financial statements of each entity. Do not discriminate, "added the sources.

 

And is that the sector is particularly annoying because automatically cut the rating of the bank once they do the same with the state. The statement, as indicated by financial sources will be announced after twelve hours have told the entities, ie, probably after 23:00 tonight.

 

The biggest problem is that many entities will enter into the very undesirable group of fallen angels. Typically, banks with a rating lower than the state and how it is now just one step from losing investment grade, most of the financial sector will receive a rating of junk bond. Possibly, only the big banks such as Santander, BBVA or get rid CaixaBank will fall to that level.

 

This is the third hit Spanish banks received in just over a month. Moody's has already cut the rating of several entities on 17 May. Downgraded the debt of 16 Spanish companies between one and three steps, also as a result of cutting Spanish debt rating a few days.

Of course, since no Spanish banks have access to the non-ECB mediated market, this move is largely symbolic but further cements the country's status as financial system pariah and the next Greece.

 


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Mon, 06/25/2012 - 07:59 | Link to Comment GeneMarchbanks
GeneMarchbanks's picture

We already kicked the RA's out so we care not. Joke's on you because now you're stuck rating only US debt.

Mon, 06/25/2012 - 08:07 | Link to Comment economics9698
economics9698's picture

Better print, opps Spain can't print, bummer.

Mon, 06/25/2012 - 08:11 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

Can't they just call Germany?

 

Mon, 06/25/2012 - 08:27 | Link to Comment Mitzibitzi
Mitzibitzi's picture

"Hi, Minty Printapoulus speaking, how can I help?"

"Hi, Minty, it's Juan. How's the family?"

"Very good, the free fruit deliveries are helping very much. Though my wife grows very tired from waiting in lines all the day."

"Good. Good. Say, Minty, you remember we talked about a delivery of product 'X'; the 'E10' kind, yeah? Well, can we place an order for say 5 billion units? We'll pay extra for quick - and quiet - delivery!"

"That will take some time, I think. We must, of course, see to our own needs, as well as those of Ernesto and Paddy. Luigi has expressed an interest, also. And I hear Cyprus Mike may also be in the market soon. But I'll see what I can do, my friend".

 

Mon, 06/25/2012 - 08:22 | Link to Comment Coldcall
Coldcall's picture

who cares what the eu does re ignoring the rating agencies....we all know Spain is totally insolvent and no-one will touch their debt with a barge pole...we dont need any RAs to tell us that.

Mon, 06/25/2012 - 09:10 | Link to Comment knukles
knukles's picture

Hah ha ha....

When you tell the NRSRO's that you don't need them anymore, you ain't gonna pay em', that they're work is a worthless piece of shit, attack their very business model and living, what the fuck you expect?

You should expect wholesale across the board downgrades as they "set things right", make amends, correct the errors of the past, become responsible, fix what's wrong....

Just be you, Europe they gonna be shafting to fix their problems.

Don't bite the hand that strokes your wally.

Mon, 06/25/2012 - 07:57 | Link to Comment Comay Mierda
Comay Mierda's picture

when wall street tells you bad news is on the way, BTFD!

Mon, 06/25/2012 - 08:22 | Link to Comment Stock Tips Inve...
Stock Tips Investment's picture

Unfortunately that is part of the price paid Spain (and also the rest of Europe) to try to end the crisis. At this time, Spain is the center of attraction of this problem. But this situation is all over Europe. We'll see to Italy and France to go through this same path. Finally, do not forget that UK and Germany (yes, Germany) are not far from facing the same crisis. We must prepare ourselves to face this situation ... and be ready to exploit any opportunities.

Mon, 06/25/2012 - 07:58 | Link to Comment daily bread
daily bread's picture

If I post my neighbor's house as "collateral", will the ECB give me a billion euros?

Mon, 06/25/2012 - 08:02 | Link to Comment lemosbrasil
lemosbrasil's picture

hahahahahah.......very good !

 

Mon, 06/25/2012 - 08:02 | Link to Comment The Onion Of Tw...
The Onion Of Twickenham's picture

No need. Just register yourself as a Spanish Bank and offer a couple of beach towels as collateral. That ought to be good for a few billion.

Mon, 06/25/2012 - 08:27 | Link to Comment j0nx
j0nx's picture

I pledge my cat's box as collateral. Those things are high in Nitrogen and make excellent fertilizer. I reckon I should get 2 or  3 billion for the box easily. Where should I go to collect my check?

Mon, 06/25/2012 - 07:57 | Link to Comment timbo_em
timbo_em's picture

No need to worry. This week's EU summit will come up with a solution.

Mon, 06/25/2012 - 08:02 | Link to Comment Ghordius
Ghordius's picture

let me guess? a plan!

Mon, 06/25/2012 - 08:15 | Link to Comment Comay Mierda
Comay Mierda's picture

no! a plan to plan!

Mon, 06/25/2012 - 08:20 | Link to Comment Ghordius
Ghordius's picture

I disagree. more is needed. let's have a plan cubed and call the thing fixed

Mon, 06/25/2012 - 08:42 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

Let me help.....I'll call the press conference.

 

Mon, 06/25/2012 - 08:52 | Link to Comment timbo_em
timbo_em's picture

I'm betting the farm that on friday EU leaders will decide to plan a schedule to come up with a plan that gives some blurry details about a vision how the EU and the Eurozone should look like in 5 to 10 years. One should also look for sentences like " sending a strong signal to the markets", "we're on the right path", "bla bla bla helps to restore confidence". It all feels pretty Soviet Union to me.

Mon, 06/25/2012 - 08:08 | Link to Comment Taterboy
Taterboy's picture

Why don't they just call up Obamie and ask him what to do. He'd have the answer because everyone from the MSM has told me he's the smartest president ever! And they are like the second smartest people ever. I know  because they tell me this everyday and they are "Journalists". So it must be true. World fixed.

Mon, 06/25/2012 - 07:58 | Link to Comment LMLP
LMLP's picture

amigos adiós ves ahí abajo

 

Mon, 06/25/2012 - 08:01 | Link to Comment Colonel
Colonel's picture

The Three bankster Amigo's get junked.

Mon, 06/25/2012 - 07:58 | Link to Comment battle axe
battle axe's picture

Moody's: you can always count on a ratings agency to be late with a downgrade. Pathetic....

Mon, 06/25/2012 - 07:59 | Link to Comment Barometer
Barometer's picture

CREDIT RATINGS.....you're doing it wrong

Mon, 06/25/2012 - 08:01 | Link to Comment TrumpXVI
TrumpXVI's picture

There must be some mistake.

Moodys hasn't heard about the Spiderman towels.

Mon, 06/25/2012 - 08:02 | Link to Comment LMLP
LMLP's picture

How are these fuckers (ratings agencies) still in business??? ALL of the sub prime is their friggen fault!!

 

Mon, 06/25/2012 - 08:03 | Link to Comment doomandbloom
doomandbloom's picture

We dont need no CRA..

We dont need no damn junk ratings..

Hey CRA....leave them PIIGS alone...

Mon, 06/25/2012 - 08:04 | Link to Comment The Swedish Chef
The Swedish Chef's picture

"Within hours"... Let me guess, they will announce it in exactly three and a haf hours, right after the European close?

Mon, 06/25/2012 - 08:13 | Link to Comment LouisDega
LouisDega's picture

No, it's when Tyler comes back from lunch.

Mon, 06/25/2012 - 08:24 | Link to Comment The Swedish Chef
The Swedish Chef's picture

Which is when? 23.00 GMT?

Mon, 06/25/2012 - 13:00 | Link to Comment LouisDega
LouisDega's picture

What do i look like, His fucking secretary? Jesus H... Besides, My hairy legs dont look good in pantyhose. 

Mon, 06/25/2012 - 08:05 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

in slewienomics, thie is bullish for:  risk0ff

Mon, 06/25/2012 - 08:06 | Link to Comment Donlast
Donlast's picture

Why are bank bondholders continuously safeguarded?  Why are they not forced to accept a haircut?  They displayed the same indifference to risk and real estate bubbles as the bankers and politicians - and Keynesians. 

Mon, 06/25/2012 - 08:11 | Link to Comment AUD
AUD's picture

I'm still waiting for Moody's to junk the Federal Reserve System. While they're at it they might as well junk the BoE, BoJ, RBA.......

Mon, 06/25/2012 - 08:08 | Link to Comment cherry picker
cherry picker's picture

If I were a RBS/NatWest Customer I would pull my money.

This bank thing will spread to England and it is about time a bank run took place, for no other reason that if regulators aren't regulating and banks are lying along with their paid for politicians, then it is time for the people to show them they do not appreciate being made fools of.

I hope you are not a fool, take what is yours and put it in a safe place or big bro or a facsimile thereof will relieve your assets for you.

Mon, 06/25/2012 - 08:16 | Link to Comment LeisureSmith
LeisureSmith's picture

I hope you are not a fool, take what is yours and put it in a safe place or big bro or a facsimile thereof will liberate your assets for you.

Fixed it.

Just like muggers liberate people of their vallets every day.

Mon, 06/25/2012 - 08:30 | Link to Comment j0nx
j0nx's picture

A what?

Mon, 06/25/2012 - 08:40 | Link to Comment LeisureSmith
LeisureSmith's picture

A Wallet.... I will promptly junk myself (if possible) for being unfunny and a terrible speller.

Mon, 06/25/2012 - 08:31 | Link to Comment Mitzibitzi
Mitzibitzi's picture

Were you channeling The Count from Sesame Street for a second, there?

Mon, 06/25/2012 - 08:10 | Link to Comment Gmpx
Gmpx's picture

Moody's should junk itself, then S&P and Fitch. After that Moody's can start junking others.

Mon, 06/25/2012 - 08:11 | Link to Comment ZeroPoint
ZeroPoint's picture

Via con dios amigos. Kiss your Keyesian asses goodbye.

 

Mon, 06/25/2012 - 08:14 | Link to Comment ugmug
ugmug's picture

This just proves the old adage that 'junk always rises to the top'

* the cream has already been siphoned off by Goldman Sachs....

 

 

Mon, 06/25/2012 - 08:14 | Link to Comment Death and Gravity
Death and Gravity's picture

Sorry if this sounds facetious, but if I know the US market well, it'll rally when the news hits.

Mon, 06/25/2012 - 08:19 | Link to Comment marco1324
marco1324's picture

My father in law has all his eggs in the one basket that is Santander in the UK. After all I have read on ZH Ive told him maybe he should move his investments out, but he won't listen. So the question is this, is he fucked?

Mon, 06/25/2012 - 08:35 | Link to Comment Mitzibitzi
Mitzibitzi's picture

Santander UK is technically a seperate entity to the main Santander operation, sharing only some management and backroom support. As such, it is pretty much independent of anything that happens to it's parent company and money will certainly not be plundered to keep foreign sections of the company afloat, so... yes, he's fucked! No doubt about it.

Mon, 06/25/2012 - 08:55 | Link to Comment Diplodicus Rex
Diplodicus Rex's picture

You mean technically separate in the Corzine type of way?

Mon, 06/25/2012 - 09:20 | Link to Comment Alejandrito
Alejandrito's picture

Ana Patricia Botin doesnt agree with you.

Mon, 06/25/2012 - 08:40 | Link to Comment mvsjcl
mvsjcl's picture

Does a bear...

Mon, 06/25/2012 - 08:28 | Link to Comment Mister Ponzi
Mister Ponzi's picture

Moody's has not as strict conditions as S&P regarding the rating ceiling of corporates. Specifically, corporates can have up to two notches uplift relative to the souvereign when a majority of their revenues is created outside the home country (as in the case of Santander). So, expect Santander and BBVA to be rated *above* the sovereign, likely at Baa2.

Mon, 06/25/2012 - 08:35 | Link to Comment Txo
Txo's picture

Burden sharing MUST happen in a few spanish banks. Unless Spains gifts the Eurocup to Germany, that is.

Mon, 06/25/2012 - 08:40 | Link to Comment the not so migh...
the not so mighty maximiza's picture

Junkapooliza 2012, except there are no druged out girls having sex with everyone.

 

Mon, 06/25/2012 - 09:17 | Link to Comment MFL8240
MFL8240's picture

Monday morning quarterbacks!

Mon, 06/25/2012 - 09:34 | Link to Comment Chump
Chump's picture

Let's get this party started already.  I've been pre-gaming so long I'm developing cirrhosis.

Mon, 06/25/2012 - 09:44 | Link to Comment gopher
gopher's picture

Can't they just bet the country on Portugal to win the semi and throw the match?

Mon, 06/25/2012 - 11:51 | Link to Comment covert
covert's picture

hope they junk them in spades.

http://covert.ias3.com/expose/

Wed, 06/27/2012 - 07:29 | Link to Comment Euro Monster
Euro Monster's picture

oops

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