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Jennifer is Co-host of The Story of Liberty Radio Broadcast, video editor and creator, blogger & Web designer for the Story of Liberty. TheStoryofLiberty.net

15 Global Banks were Downgraded today

Moody’s just took a hatchet to the credit ratings of the biggest global banks.

The rating agency on Thursday cut its rating for banks in the U.S., U.K. and Europe — 15 in all, including all of the “too big to fail” banks in the U.S.

In a press release announcing the downgrades, Moody’s said, “All of the banks affected by today’s actions have significant exposure to the volatility and risk of outsized losses inherent to capital markets activities. In the past, these risks have led many institutions to fail or to require outside support, including several firms affected by today’s rating actions.”

Bank of America’s debt rating was cut by one notch. Citigroup, Goldman Sachs and JPMorgan Chase each took a two-notch downgrade.

Morgan Stanley’s rating, meanwhile, was also cut by two notches, to Baa1 from A2 — a break for the bank. Moody’s had warned in February that it could cut Morgan Stanley by up to three notches. Since then, the bank has vigorously contested the impending downgrade, pointing to capital it has raised and risks it has shed in the years since the financial crisis.

“Lower ratings will likely reduce the degree of trading activities over time at a particular institution,” CLSA bank analyst Mike Mayo wrote in a research report.


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2 Comments on “15 Global Banks were Downgraded today”

  1. Michael June 22, 2012 at 8:12 pm #

    This is funny because GOP lead Congress was just last week fawning all over Jamie Dimon of JPMC. I think we have the foxes guarding the hen house here..

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