TWO RATINGS AGENCIES have announced downgrades to Spanish banks this evening.

Fitch announced the credit rating downgrade of four of the country’s main banks, while Standard and Poor’s said it was downgrading 15 financial institutions based in Spain.

Long-term debt ratings

Fitch cited last month’s downgrade of Spain’s debt as a move which would weaken the government’s ability to support its largest banks, making their debt more risky for investors.

The agency also said in its statement that the country’s weak property market and economy would depress the banks’ asset values and profitability, and said it was cutting the long-term debt rating on each of Banco Bilbao Vizcaya Argentaria, Bankia SA, CaixaBank SA and Caja de Ahorros y Pensiones de Barcelona.

S&P

Separately, Standard and Poor’s announced it was lowing its ratings for 15 Spain-based financial institutions. The ratings agency said its decision was also based its recent downgrade of Spain. The organisation cited its own assessment of the stand-alone credit profiles of ten of the banks as the reason for downgrading them by  one notch.

The other five were downgraded by two notches.

The banks involved in S&P’s downgrade this evening include BBVA, Bankia SA, CaixaBank and Caja de Ahorro y Pensiones de Barcelona (as above with Fitch), as well as Santander.

Both Fitch and S&P downgraded Spain’s debt last month.

- Additional reporting by the AP