Both ANZ Banking Group Limited (ASX:ANZ) and Westpac Banking Corporation (ASX:WBC) have informed the market that they, along with Australia’s other major banks, have had their long-term credit ratings downgraded by one notch to Aa3.
It comes as the ratings house, Moody’s, revised Australia’s macro profile, which resulted in 12 Australian banks having their long-term credit ratings changed.
Moody’ says it dropped its view, as Australia’s credit conditions have deteriorated. Moody’s noted high and rising levels of debt, from low wage growth, have led to very high levels of household leverage, which could lead to credit problems later.
On a more positive note, Moody’s revised the rating outlook for the four major Australian banks from ‘negative’ to ‘stable’.
Shares in Westpac Banking Corp (ASX:WBC) last traded over 1.1 per cent higher yesterday $30.88, while shares in ANZ Banking Group Limited (ASX:ANZ) last traded over 0.90 per cent higher to $28.38.