Spain suffered a fresh blow as 28 of its banks were hit with credit downgrades while Cyprus became the latest eurozone country to request a rescue loan, days ahead of a pivotal European Union summit. The Moody’s decision to slash the Spanish lenders’ ratings came just hours after Madrid made a formal request for cash to bail out its troubled banking sector. The agency said it slashed the ratings because they faced rising losses from commercial real estate loans, adding that Madrid’s own lowered credit grade was a contributory factor. Spain’s lower creditworthiness “not only affects the government’s ability to support the banks, but also weighs on banks’ stand-alone credit profiles”, the agency said.
