MILAN, Nov 28 (Reuters) - Shares in Banco Popolare fell 2.5 percent on Wednesday after agency Moody’s put the Italian bank’s credit rating on review for a possible downgrade to ‘junk’.
In a statement late on Tuesday Moody’s said that the asset quality of Italy’s fourth-biggest bank was “weak and likely to deteriorate well into 2013” as the country continues to suffer under a grim recession.
Banco Popolare’s problem loans represent 16 percent of total loans, which Moody’s says is significantly above the banking system’s average.
Moody’s rates Banco Popolare’s credit strength Baa3, just one notch above non-investment grade. (Reporting By Lisa Jucca, editing by Stephen Jewkes)