International credit rating agency Moody’s has lowered its outlook on 17 German banks from “stable” to “negative”.

The rating agency on Wednesday made the move shortly after it lowered its outlook on the European Financial Stability Facility(EFSF) to “negative.”

The German banks affected by the downgrade are state-backed regional banks, including IKB Deutsche Industriebank and Deutsche Postbank.

The agency warned that more downgrades could come if there was a "further deterioration of the creditworthiness" of Germany's central or regional governments.

Earlier on Monday, Moody’s slashed its outlook for Germany, the Netherlands and Luxembourg, which are major guarantors of the European Financial Stability Fund(EFSF), from “stable,” to “negative”, citing financial jitters in European countries.