18 October 2011 Last updated at 13:44 ET

S&P downgrades 24 Italian banks

S&P said PM Silvio Berlusconi's government needed to implement workable growth-enhancing measures

Standard & Poor's has downgraded the credit ratings of 24 Italian banks and financial institutions.

"Renewed market tensions in the eurozone's periphery, particularly in Italy, and dimming growth prospects have led to further deterioration in the operating environment for Italian banks," S&P said in a statement.

It predicted Italy's banks would have to pay more to borrow money for years.

Last month S&P downgraded seven other Italian banks and the whole country.

The banks involved include Banca Monte dei Paschi di Siena, Banco Popolare Societa Cooperativa, Banca Popolare dell'Emilia Romagna, Banca Popolare di Milano, Banca Popolare di Vicenza and Banca di Bologna.

S&P warned that it did not think the the current "difficult operating climate is transitory or that it will be easily reversed".

It added that the high price the Italian government was having to pay to borrow money would mean that the cost of funding would rise for Italian banks.

It also said that the government had to reduce its debt and implement "workable growth-enhancing measures".