Moody's cuts Societe Generale

Moody's Investors Service said it downgraded the stand-alone bank financial strength rating of Societe Generale by two notches to C- from C+, mapping to Baa1 on the long-term scale from A2 previously, and the long-term debt and deposit ratings by one notch to A1.

The outlooks on the bank financial strength rating and long-term rating are negative. The Prime-1 short-term rating was affirmed.

Dated subordinated debt securities were also downgraded by one notch to A2 and remain on review for downgrade pending the agency's reassessment of systemic support for such debt.

Moody's said the lower bank financial strength rating reflects its view that SocGen's prior credit-positive factors diminished and are now offset by liquidity and funding constraints.

Moody's also said the severity of the crisis facing the euro area has increased, and as one of the largest banks in the euro area, SocGen's creditworthiness is necessarily affected by the fragile operating environment for European banks.

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