Paris, Sep 14 (IANS): Financial ratings agency Moody's Wednesday downgraded two leading French banks, Societe Generale and Credit Agricole SA.

The US-based agency has cut Credit Agricole's rating from AA1 to AA2 and of Societe Generale from AA2 to AA3, citing Greek exposure for the former, and funding and liquidity problems for the latter, reported Xinhua.

France's second-largest listed bank Societe Generale's "capital base currently provides an adequate cushion to support its Greek, Portuguese and Irish exposures", but its dependency on wholesale funding is a problem, Moody's concluded in a statement.

French Economy Minister Francois Baroin and central bank Banque de France Governor Christian Noyer have urged banks to disclose usually more details of their financial situation to guard the market confidence, said Xinhua.

"It's relatively good news, the downgrade is very limited," and the notes are "better" than expected, Noyer commented at Moody's downgrading Wednesday.

"The level of capital and the profitability of French banks allow them to absorb all the potential losses on sovereign risks" in the context of the abnormal turmoil impacting the banking system, the central bank governor asserted.