[HONG KONG] Moody's Investors Service cut its credit-rating outlook on 38 Chinese state-owned enterprises and 25 financial institutions after the agency's decision to lower the country's sovereign credit-rating outlook.
The SOEs' outlook was reduced to negative, Moody's said in a Thursday statement, a day after it issued a separate release downgrading the non-insurance financial firms to negative from stable. The financial institutions include three policy banks, 12 domestic commercial banks and three distressed asset-management companies, Moody's said March 2.
The SOE and financial downgrades followed Moody's decision to lower its outlook on China's sovereign credit rating on Wednesday to negative from stable. The agency highlighted the country's surging debt burden and questioned the government's ability to enact reforms.
The move came just days before Chinese leaders gather in Beijing to approve a five-year road map for the economy.