Moody's Investors Service downgraded the ratings on six Eurozone countries, mainly citing the uncertainty over the euro area's prospects for institutional reform of its fiscal and economic framework. At the same time, the agency lowered the outlook on the triple-A ratings of UK, France and Austria to 'negative'.

Moody's said Monday that its has downgraded Italy, Spain, Malta, Portugal, Slovakia and Slovenia with a 'negative' outlook.

Italian debt rating was downgraded to A3 from A2, while Malta too was cut to A3 from A2. Spain saw its rating falling to A3 from A1. The ratings on Portugal was lowered to Ba3 from Ba2. Slovakia and Slovenia have their ratings cut to A2 from A1.

Furthermore, the outlook on the AAA ratings of France, Austria and the United Kingdom was changed to 'negative'. Moody's said the increased uncertainty regarding the pace of fiscal consolidation in the UK due to materially weaker growth prospects over the next few years is the main factor behind the outlook downgrade.

Regarding France, the agency said the country faces challenges from uncertainty over reforms in euro area, the ongoing deterioration in public debt metrics and significant risks to the the government's ability to achieve its fiscal consolidation targets.

Overall, Moody's said it is concerned about the uncertainty over the euro area's prospects for institutional reform of its fiscal and economic framework and the resources that will be made available to deal with the crisis.

Also, Europe's increasingly weak macroeconomic prospects, and the impact these factors will continue to have on market confidence have also contributed to the latest rating action.

According to Moody's, these factors are constraining the creditworthiness of all European sovereigns and exacerbating the susceptibility of a number of sovereigns to particular financial and macroeconomic exposures.

However, on Tuesday, Moody's affirmed its provisional Aaa long-term debt rating on the European Financial Stability Facility (EFSF), with a continued 'stable' outlook for the debt issuance program.

Meanwhile, Standard & Poor's Ratings Services lowered its investment-grade credit ratings on 15 Spanish banks, a month after it cut its ratings on Spain. At the same time, Fitch lowered its ratings on four big Spanish banks.

The downgrade by S&P reflects the possibility that the agency could downgrade Santander and the subsidiaries if they were to lower the sovereign ratings. Also, the action followed a revision of Banking Industry Country Risk Assessment on Spain to group '5' from group '4'.

The rating of Santander was lowered to 'A+' from 'AA-', while BBVA was cut to 'A' from 'A+'.

In January, S&P downgraded nine Eurozone nations, while Fitch lowered the ratings on five euro members.

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