S&P cuts ratings, outlooks on 22 U.S. banks
Standard & Poor's on Wednesday cut the ratings and outlooks on 22 U.S. banks, citing expectations of more difficult operating conditions due to volatile financial markets and tighter regulation.
Among the rating changes, S&P cut the counterparty credit ratings of Wells Fargo & Co (WFC.N) by one notch to AA-, U.S. Bancorp by two notches to A+ and Fifth Third Bancorp (FITB.O) by two notches to BBB.
S&P also downgraded the counterparty credit ratings of Huntington Bancshares (HBAN.O) and Carolina First Bank by two notches to junk-status BB+ with a negative outlook. It also cut Citizens Republic Bancorp (CRBC.O) counterparty credit rating by three notches to BB- with a negative outlook [ID:nWLA6796]. "We believe the banking industry is undergoing a structural transformation that may include radical changes with permanent repercussions," said Standard & Poor's credit analyst Rodrigo Quintanilla.
"Financial institutions are now shedding balance-sheet risk and altering funding profiles and strategies for the marketplace's new reality. Such a transition period justifies lower ratings as industry players implement changes."
[Source: Reuters, London, 17Jun09]
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