Monday's downgrade for SID, the largest Slovenian bank NLB, and Abanka Vipa, the third biggest, was accompanied by an announced review for possible further downgrade for all three of them.

Also placed on review for possible downgrade were individual ratings for NKBM, the second largest Slovenian bank, which is in majority state ownership like the NLB.

Moody's explained that the very high likelihood of systemic support for Slovenian banks has helped keep ratings high, but added that reassessments were needed in the light of the downgrade of the sovereign rating.

"Moody's will reassess the notching uplift from systemic support and the government's capacity to extend its balance sheet and arrive at the political consensus necessary to provide on-going support to the banking system."

"For SID Banka - which is guaranteed by the government - the ratings will be adjusted in-line with the government ratings."

The crisis "has exposed significant vulnerabilities within the Slovenian financial sector, reflected by sharp deterioration in asset quality and the significant wholesale refinancing needs of the commercial banks", the agency moreover wrote.

The has led to capital injections for NLB and funding guarantees for NLB and Abanka, with Moody's moreover stressing that "deposits from government-related institutions represent a relatively large part of these banks' liabilities, in light of the limited investor appetite from international wholesale markets."

The agency sees "an increased likelihood for the banks to realise further losses on their high corporate-sector exposures at a time when the internal capital creation in the Slovenian banking system is one of the lowest compared to the last several years".

"This may require further capital injections into these banks, considering the fact that in Moody's view, the capitalisation of the Slovenian banking system is relatively weak."