Posted 26.06.2012 09:05:07 UTC
Updated 26.06.2012 09:05:07 UTC
The announcement from Moody's to cut the credit rating of Spanish banks came after the Spanish government's formally asking for a help from the EU to clean up its stricken banking sector, on Monday.
Moody's cut the credit ratings of the Spanish banks in a range between 1 to 4 notches.
Only Santander, BBVA, Caixabank, Banesto, Banca March, Caja Rural Navarra and Caja Laboral remained above Ba1 which is considered as speculative for investments.
Meanwhile, Spanish Bank Santander, which was downed from A3 to Baa2, was the only bank staying above the national credit rating average of Baa3.
The downgrades are a measure of Moody's view on the ability of the 28 banks to repay their debts.
A downgrade usually means that banks will have to pay more for their debt.
The Spanish economy, the fourth largest of the 17 countries that use the euro currency, is suffering from the aftershocks of a real estate bust that has devastated families as well as banks.
Unemployment is nearly 25 percent in the country.