Moody's: Five South African banks reviewed for cut

Moody's Investors Service said it placed on review for downgrade the ratings of five South African banks to assess the uplift their debt and deposit ratings receive from high systemic support assumptions. The affected banks are Standard Bank of South Africa, Absa Bank Ltd., FirstRand Bank Ltd., Nedbank Ltd. and Investec Bank Ltd.

Moody's said the review has been triggered partially by the recently assigned negative outlook on South Africa's A3 government bond rating, which reflects constrained public finances and signals that government financial flexibility may be weakening, indicating that authorities would likely face more challenging policy choices if multiple institutions were to need its financial support at the same time.

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