Moody's downgrade of Australian banks won't raise funding costs: analysts

Sydney

A CREDIT ratings downgrade of Australia's biggest banks by Moody's Investor Service is not expected to raise their funding costs because the new rating is in line with other ratings agencies, banking analysts said.

Moody's on Monday downgraded the four largest Australian banks to a long-term credit rating of Aa3 from Aa2, citing risks from high household debt levels after sharp property price rises. The new rating is in line with the long-term AA- credit rating that Commonwealth Bank of Australia, Westpac Banking Corp, Australia and New Zealand Banking Group Ltd and National Australia Bank Ltd (NAB) have from Standard & Poor's (S&P) and Fitch Ratings.