LUXEMBOURG: Moody's has cut the ratings of 11 European banks and said it would cut again if Greece ditched the euro, kicking off a long-awaited round of downgrades for major European institutions.
Moody's Investors Service said yesterday it had taken action against five Dutch banking groups, three French banks and one each from Belgium and Luxembourg.
Investors shrugged off the news after central banks from major economies had indicated they were prepared to take steps, including coordinated action, to stabilize markets in the wake of Greece's election on Sunday. The benchmark FTSEurofirst 300 index was up 0.7 percent at 0835 GMT.
Still, the downgrades will only add to pressure on European Union leaders to sort out the region's debt crisis.
Moody's was expected to downgrade some of the world's biggest banks by the end of June, which would widen the gulf in prospects between the strongest banks and weaker rivals. Bank of America Corp, Citigroup and Morgan Stanley are among those whose ratings could be affected.
Yesterday, Moody's cut four Dutch banks by two notches with one moved a single step lower. It kept a negative outlook for Dutch bank and insurer ING Bank, one of those cut two notches, meaning the rating could be cut again.
ING shares were up 2.8 percent, while SNS Reaal, whose banking unit was also downgraded, rose 3.9 percent, buoyed by the better tone in the broader market.
"Today's actions reflect Moody's view that Dutch banks will face difficult operating conditions throughout 2012 and possibly beyond," it said.
The agency said there were heightened risks for creditors amidst elevated uncertainty and downside risks to the economic outlook and fragile investor confidence in Europe.
Moody's agency said it had cut the ratings by two notches to Aa2 for Rabobank Nederland, to A2 for ING, to A2 for ABN AMRO Bank, and to Baa2 for LeasePlan Corporation.
The long-term debt and deposit ratings for SNS Bank, owned by SNS Reaal, were cut one notch to Baa2.
Short-term ratings for all the groups were unchanged.
Moody's said while it had factored in an increased risk of Greece leaving the euro area, this was not its central scenario. "If a Greek exit became Moody's central scenario, further rating actions on European banks could well be needed."
Moody's said the negative outlook for ING took into account the bank's funding structure, which relies substantially on wholesale funds and a significant amount of non-domestic deposits. ING received 10 billion euros in state aid during the 2008 financial crisis.
It was subsequently forced to separate its banking and insurance businesses and sell off various assets to meet European Commission requirements for state aid. The disposal could also help to raise money to repay state aid.
Moody's also cut ratings for French groups Banque Federative du Credit Mutuel, BPCE and CIC, and also KBC from Belgium, and Banque et Caisse d'Epargne de l'Etat from Luxembourg.
"To date, we have taken actions on banks in Germany, Austria, Spain, Italy, Portugal, Sweden, Norway, Denmark and Finland," it said.
Moody’s cuts ratings of 11 European banks
Moody’s cuts ratings of 11 European banks
Stc posts record $20.7b revenue as net profit rises 12.5%
RIYADH: Stc Group announced its consolidated financial results for 2025, recording the highest revenue in its history at SR77.8 billion ($20.7 billion), up 2.5 percent from the previous year.
Net profit increased 12.5 percent after excluding non-recurring items, reflecting the strength of the group’s business model and the continued execution of its sustainable growth strategy.
The group said gross profit rose to SR37.7 billion, while operating profit reached SR14.4 billion. Earnings before interest, taxes, depreciation, amortization and zakat totaled approximately SR24.5 billion, marking 6.1 percent growth after excluding non-recurring items, driven by improved operational efficiency and disciplined cost and capital expenditure management.
The company announced a dividend of SR0.55 per share for the fourth quarter of 2025 in line with its approved dividend policy.
stc Group emphasized its commitment to developing employee capabilities and skills. Over the past year, it reported qualitative progress in talent development through programs such as Partner Development, Job Attachment and the stc Academy.
The group also sponsored the Human Capability Initiative conference, where it launched a public training platform aimed at equipping national talent with skills aligned with future labor market needs. The initiative underscores its commitment to building digital capabilities in the Kingdom and strengthening national competitiveness.
stc plays a key role in supporting major international events and religious occasions such as Hajj and Umrah. It continues to support national forums and major events through a reliable digital infrastructure that enhances national identity and elevates the readiness of vital sectors with high efficiency.
The group said its connectivity solutions and digital services meet international standards, contributing to the Kingdom’s position as a leading destination across sectors and reinforcing stc’s role as a regional digital enabler.
CEO Olayan bin Mohammed Alwetaid said the results demonstrate the group’s ability to achieve sustainable profit growth while diversifying income sources and strengthening digital infrastructure.
He said the company continues expanding its network to reach more than 10,800 5G sites and 3.75 million homes served by fiber, in addition to conducting the first regional trial in the 7 GHz band in preparation for 6G technologies.
The group expanded STC Bank to more than 8 million customers and signed strategic partnerships to establish AI-focused data centers with capacity of up to 1 gigawatt. It also completed strategic digital infrastructure agreements worth billions and issued $2 billion in sukuk that were more than four times oversubscribed.
In sustainability, the group’s MSCI rating rose to AA and it received a five-star EFQM certificate. It maintained its position as the strongest brand in the Middle East for the sixth consecutive year.
According to the Brand Finance 2026 report, stc ranked as the strongest brand in the Middle East, third globally among telecommunications brands, and ninth in global telecom brand value, placing it among the world’s top ten telecom companies by brand strength.
