International credit rating agency Moody’s has downgraded by one notch the deposit ratings of Israel’s five biggest banks for fear of weak profitability compared to similar banks worldwide.
Bank Hapoalim, Bank Leumi and Bank Mizrahi Tefahot were downgraded from level A1 to A2; Israel Discount Bank and First International Bank of Israel were downgraded from level A2 to A3.
According to Moody’s, “The rating downgrades are driven by expectations that the banks’ underlying profitability will remain weak due to their rigid cost bases.”
The rating agency added that notwithstanding the downgrades, “Israeli banks display healthy liquidity profiles and stable franchises operating in a well-regulated environment.”
Israel is the only Western country in which not one bank has collapsed during and as a result of the global financial crisis. In the United States, more than 230 have closed. — ynetnews.com