Moody's downgrades KL banks

Moody's downgrades KL banks

KUALA LUMPUR (Reuters): Rating agency Moody's Investors
Service downgraded the debt, deposit and bank financial strength
ratings of five major Malaysian banks on Monday, dealing a fresh
blow to the country's battered banking sector.

Moody's also placed those same ratings under review for
possible further downgrades.

The rating agency said the banks downgraded were Malayan
Banking Bhd (Maybank), Bank Bumiputra Bhd, Public Bank Bhd, RHB
Bank Bhd and Sime Bank Bhd.

Moody's said the downgrades reflected the increasing risk to
creditors of Malaysian entities following the economic policy
measures announced by the government.

Malaysia recently imposed sweeping capital controls in a bid
to insulate its recession-hit economy from global instability and
shield its ringgit currency from speculators, blamed by the
government for Asia's financial turmoil.

The banking sector, faced by growing non-performing loans
(NPLs), has been badly-hit by the crisis with the profits of some
dipping into the red.