Sun, Dec 21, 2008 - Page 11 News List

S&P lowers credit ratings of 11 banks in US and Europe


Global ratings agency Standard & Poor’s (S&P) on Friday lowered the credit ratings of 11 US and European banks by one or two notches on uncertainty over future performance.

Central banks around the world also moved to ease the credit crunch gripping the banking industry by announcing plans to pump more cash into the financial system, the US Federal Reserve said.

The banks affected by the S&P rating review were Bank of America, Barclays, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, JPMorgan Chase, Morgan Stanley, Royal Bank of Scotland, UBS and Wells Fargo.

S&P also revised its outlook on British giant HSBC Holdings and a number of its subsidiaries to negative from stable.

“The downgrades and revised outlooks reflect our view of the significant pressure on large complex financial institutions’ future performance due to increasing bank industry risk and the deepening global economic slowdown,” the ratings agency said in a statement.

But it said government intervention intended to stabilize the banking sector and restore public confidence “may balance these pressures to a large extent.”

The agency had raised earlier this month its “overall assessment of bank industry risk” and believed there would be more volatility in funding markets.

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