NEW YORK (
) -- Moody's has downgraded five Egyptian banks saying that the government may not be able to support the banking system due to political unrest.
The banks recieving downgrades include
National Bank of Egypt
Banque du Caire
Commercial International Bank
Bank of Alexandria
Moody's said in a note, "that the performance of the banks' credit portfolios, which are essentially domestic and concentrated, would likely deteriorate in a weakening macroeconomicenvironment. Moreover, asset quality deterioration would force banks toraise loan loss provisioning, thereby further weighing on their economiccapital position and damaging their profitability."
The rating agency also lowered the sovereign rating of Egypt to Ba2 (negative outlook) from Ba1 (stable outlook) because the political turmoil is negatively impacting the economy and the financial health of the bank, including bank deposits.
--Written by Maria Woehr in New York.
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