Rating of AIB's Polish subsidiary cut

The Polish subsidiary of Allied Irish Banks (AIB), Bank Zachodni WBK SA, saw its shares fall this morning after Fitch Ratings lowered its debt outlook for the Polish bank and the stock was downgraded by UniCredit SpA.

Bank Zachodni shares traded at 140 zloty, down 3.6 per cent at 9.53am in Warsaw.

The move follows a similar cut by Fitch in the outlook for the bank's Irish parent company, AIB which holds a 70.5 per cent stake in Bank Zachodni.

Earlier this week Fitch cut AIB’s debt outlook to negative, citing risks from a slowing Irish economy.

“The negative outlook reflects some uncertainty over the intensity and duration of the economic slowdown, which could cause AIB's profitability and/or impaired loans to worsen more than expected,” Fitch said in relation to AIB.

Fitch cut its debt outlook for Bank Zachodni to negative from stable

Separately, UniCredit analyst Iza Rokicka in Warsaw reduced her recommendation on Zachodni shares to “hold” from “buy” and lowered her price estimate 31 per cent to 150 zloty, citing falling fee income and higher costs at the Polish bank.

At 10.35am AIB shares were trading down 0.6 per cent at €8.15.

Additional reporting Bloomberg