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Moody's downgrades British banks -

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Moody's downgrades British banks

Broadcast: 07/10/2011

Reporter:

Ratings agency Moody's has downgraded 12 British financial institutions, saying the government is
less likely to provide support in the event of future trouble.

Transcript

ALI MOORE, PRESENTER: Ratings agency Moody's has downgraded 12 British financial institutions
including two major banks, Lloyds and Royal Bank of Scotland.

Moody's said the downgrade was not due to a deterioration in the strength of the banking system,
but reflected the fact that the government was less likely to provide support for some banks in the
event of future trouble.

The Chancellor of the Exchequor, George Osborne, confirmed the government was taking steps to avoid
any government bailout, but said that British banks were well capitalised compared with other
European banks.

Earlier, just hours after the Bank of England had announced a round of quantitative easing, which
will see the injection of 75 billion pounds into the British economy, the Central Bank's chief,
Mervyn King, warned the world may be facing its worst ever economic crisis.