Moody's Downgrades Top Three Cyprus Banks

NICOSIA, Cyprus (AP) - Moody's Investor Service has downgraded Cyprus' top three commercial banks, bring them closer to the bottom of junk status, because of uncertainty over the country's bailout talks with international creditors. Moody's downgraded Bank of Cyprus, Laiki Bank and Hellenic Bank - the country's first, second and third biggest lenders, respectively - to Caa2 and warned more downgrades are possible.

Last week, Moody's slashed Cyprus' sovereign rating by three notches to Caa3. Moody's said Monday that it's still unclear what conditions a bailout deal with the European Commission, the European Central Bank and the International Monetary Fund will contain and when it will be signed. It also said in a statement that a heightened risk of the Cyprus government defaulting could hurt the ailing banks, even if they receive rescue money.