25 Feb 2012

Australian bank ratings downgraded

7:38 am on 25 February 2012

Fitch has downgraded the credit ratings of three of the big four banks in Australia, citing higher funding costs.

Commonwealth Bank, Westpac and National Australia Bank were downgraded to AA- from AA.

ANZ, which already had a rating of AA-, was unchanged.

The ABC reports Standard & Poor's also downgraded the credit ratings of all four banks from AA to AA-in December.

In a statement issued on Friday, Fitch said:

''Wholesale funding, particularly when sourced cross borders, has become more vulnerable to swings of confidence.

''Despite some improvement since 2008, all four banks retain a reliance on wholesale funding, particularly from offshore markets.''