Standard & Poors Ratings Services today downgraded the ratings of 11 major U.S. and European banks because of the weak economy and credit crunch.
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, S&P said in a statement announcing the downgrades.
S&P also said it now has a higher risk assessment of the bank sector, expecting more volatility in funding markets.
Wells Fargo Bank remains the best-rated bank at AA-plus, although down from AAA, while Goldman Sachs Group and Morgan Stanley were each given a single-A rating, down from AA-minus. HSBC Bank kept its AA rating, but its outlook was lowered to negativMorgan Stanley and Morgan Stanley were each given a single-A rating, down from AA-minus. HSBC Bank kept its AA rating, but its outlook was lowered to negative from stable.
Other banks whose rating was downgraded were Bank of America, Barclays Bank, Citibank, Credit Suisse, Deutsche Bank, JPMorgan Chase Bank, Royal Bank of Scotland and UBS.