The international investors service Moody’s upgraded the long-term credit rating of the Icelandic banks, Glitnir, Kaupthing and Landsbanki, in February. But due to stark criticism Moody’s lowered their credit rating again.
Moody’s upgraded the long-term credit rating of the three Icelandic banks along with 41 others to Aaa, the highest rating possible, due to new a new methodology, as ruv.is reports.
Moody’s new methodology took into consideration the likelyhood of government support for banks in case they run into trouble, which resulted in upgrades for the Icelandic banks and 41 other banks.
This new methodology came under stark criticism from financial experts, so Moody’s felt forced to review its upgrades of the 44 banks.
Now Moody’s has downgraded its ratings of all these banks again; 29 were downgraded by one step, 12 by two steps and the Icelandic banks went down by three steps. Their long-term credit rating is now Aa3.
Click here to read more about criticism of Moody’s new methodology.