The international credit rating agency Standard & Poor's said Tuesday it has cut the long-term credit ratings of Commerzbank, saying Germany's second-biggest bank faced a "tough time" getting its house in order. S&P said in statement it has lowered Commerzbank's credit rating by one notch to "A-" (A-minus).
At the same time, it placed a "negative" outlook on Commerzbank, suggesting the rating could be downgraded further, possibly to "BBB+" (triple-b plus) if the current deterioration in the economic environment jeopardises the bank's efforts to reduce its risk exposure. "Commerzbank's creditworthiness could deteriorate if we were to lower our economic risk assessments in its main operating regions," the rating agency said. In mid-May, Commerzbank unveiled a 2.5-billion-euro ($3.2-billion) capital hike to pay back state bailouts received during the 2008-2009 financial crisis. In the three months to March, the group booked a net loss of 94 million euros owing to heavy restructuring costs.