It is late in the afternoon on a Friday, which means one thing: it is time to dump all left over bad news under the rug. Sure enough, here comes S&P. From Bloomberg:

S&P CUTS RATINGS ON 15 ITALIAN FINL INSTITUTIONS

S&P TAKES RATING ACTIONS ON 32 ITALIAN FINL INSTITUTIONS

BANCA MONTE DEI PASCHI DI SIENA SPA CUT TO BBB-/NEGATIVE/A-3

BANCA POPOLARE DI MILANO SCRL CUT TO BB+/NEGATIVE/B BY S&P

S&P SEES ITALIAN BANKS' VULNERABILITY TO CREDIT RISK RISING

S&P SAYS ITALY FACES POTENTIAL DEEPER RECESSION THAN IT THOUGHT

Full release:

Standard & Poor's Ratings Services today said it has taken rating actions on 32 Italian financial institutions.

These include affirming our counterparty credit ratings on 15 entities, lowering our ratings on 15, removing the ratings on four from CreditWatch negative, and revising the outlook on one.



The rating actions reflect our view of increased credit risk for the Italian economy and its banks. They follow our revision of our economic risk score for Italy, one of the main components of our Banking Industry Country Risk Assessment (BICRA), to '5' from '4'. We have maintained our BICRA for Italy at group '4' and our industry risk score at '4' (see "BICRA On Italy Maintained

At Group '4', Economic Risk Score Revised To '5' On Increased Credit Risk For Italian Banks," published Aug. 3, 2012, on RatingsDirect on the Global Credit Portal).



With Italy facing a potentially deeper and more prolonged recession than we had originally anticipated, we think Italian banks' vulnerability to credit risk in the economy is rising. In this context, the combined effect of mounting problem assets and reduced coverage of loan loss reserves makes banks more vulnerable to the impact of higher credit losses particularly in the event of deterioration in the collateral values of assets.



In our opinion, a more severe recession will likely push up the stock of Italian banks' problem assets in 2012 and 2013 to levels higher than we previously expected and high relative to the stocks in other banking systems in Europe. At the same time, the banks' coverage of problem assets through provisioning, which was already low by international standards because of the banks' extensive use of tangible collateral in their assessment of provisioning needs, has fallen further over the past few years.



See the list below for the rating actions on the financial institutions and their relevant subsidiaries.



We will publish individual research updates on the banks identified below, including a list of ratings on affiliated entities, as well as the ratings by debt type--senior, subordinated, junior subordinated, and preferred stock.





RATINGS LIST

The ratings listed below are issuer credit ratings unless otherwise stated.



Ratings Affirmed





Banca Fideuram BBB+/Negative/A-2



Banca Mediocredito del Friuli-Venezia Giulia SpA BBB/Negative/A-3



Banco Popolare Societa Cooperativa SCRL Credito Bergamasco BBB-/Negative/A-3

Banca Aletti & C. SpA



Credito Emiliano SpA BBB/Negative/A-2



Intesa Sanpaolo SpA BBB+/Negative/A-2

Banca IMI SpA



Istituto Centrale delle Banche Popolari Italiane SpA

CartaSi SpA BBB-/Negative/A-3



Istituto per il Credito Sportivo BBB+/Negative/A-2



Mediobanca SpA BBB+/Negative/A-2



MedioCredito Centrale SpA BBB-/Negative/A-3



UniCredit SpA BBB+/Negative/A-2

UniCredit Leasing SpA



Downgraded

To From



Banca Carige SpA BB+/Negative/B BBB-/Negative/A-3



Banca di Credito Cooperativo di Conversano S.c.r.l BB+/Negative/B BBB-/Negative/A-3



Banca Popolare dell'Alto Adige BBB-/Negative/A-3 BBB/Negative/A-2



Banca Popolare dell'Emilia Romagna S.C. BB+/Negative/B BBB/Negative/A-2



Banca Popolare di Vicenza ScpA BB+/Negative/B BBB-/Negative/A-3



Dexia Crediop SpA B+/Negative/B BB-/Negative/B



Eurofidi Scpa BB+/Negative/B BBB-/Negative/A-3



Iccrea Holding SpA

Iccrea Banca SpA

Iccrea BancaImpresa SpA BBB-/Negative/A-3 BBB/Negative/A-2



Unione di Banche Italiane Scpa BBB/Negative/A-2 BBB+/Negative/A-2



Downgraded; CreditWatch Action



Agos-Ducato SpA BBB-/Negative/A-3 BBB/Watch Neg/A-2



Banca Monte dei Paschi di Siena SpA BBB-/Negative/A-3 BBB/Watch Neg/A-2



Banca Popolare di Milano SCRL

Banca Akros SpA BB+/Negative/B BBB-/Watch Neg/A-3



Outlook Action



FGA Capital SpA BBB-/Negative/A-3 BBB-/Stable/A-3





CreditWatch Action; Ratings Withdrawn



Withdrawn To From

Cassa di Risparmio della Provincia di Teramo SpA N.R. B/Negative/B B/Watch Neg/B



NB. This list does not include all ratings affected.