Barclays, Lloyds and the RBS have been downgraded by Moodys rating agency as part of an overall review, that has resulted in 15 International Banks suffering downgrades to their credit rating, three here in the UK and four big names in the US.

This is on the back of lower profit prospects and general exposure to a negative European economical environment and other banks within it.

While this will impact on their ability to borrow in the wholesale markets and raise their cost of funding, the downgrades were largely expected and could have been much worse.

Spain are currently seeking a loan of Euro 62 billion from the EU to prop up the Spanish Banking system, suffering from bad debts due to the collapse of the Spanish property market that will put out one fire once granted.