Fitch downgrades Cyprus to BB+, negative outlook

http://www.marketwatch.com/story/fitch-downgrades-cyprus-to-bb-negative-outlook-2012-06-25?link=MW_home_latest_news

Fitch Ratings on Monday cut Cyprus's credit rating to BB+ from BBB- and maintained a negative outlook on the euro-zone country's rating, citing expectations Cypriot banks will need further, substantial capital injections due largely to the institutions' exposure to Greek debt. In addition to the 1.8 billion euros ($2.3 billion) required to recapitalize Cyprus Popular Bank, Fitch said it expects the country's banks could need as much as an additional 4 billion euros (equal to 23% of gross domestic product) in additional capital. The ratings firm said that while the bulk of the losses suffered by the banking system are due to Greek exposure, the reported non-performing loan ratio for domestic Cypriot loans has also risen substantially over the past year as the country's economy contracted and unemployment rose.