Credit Ratings of 10 Banks Downgraded by Moody’s, Six Others Placed on Notice

Moody’s, the ratings agency, has downgraded the credit ratings of⁢ 10 small ⁤and midsized banks. Additionally, they have⁤ placed six big lenders ⁤on notice for a ‌future downgrade. The agency cited profitability challenges and funding risks as the ‍reasons for the downgrades.

Key Takeaways

Moody’s has downgraded the credit⁢ ratings of 10 smaller⁣ regional and midsized banks. They have also assigned a negative outlook for six⁢ big lenders. The ‌agency highlighted higher funding costs, profitability ⁢pressures, and slowing loan growth as common ⁣themes in ⁤banks’ second-quarter earnings. They⁣ also mentioned that ⁢the Federal Reserve’s ⁤rate hikes will ⁤lower profitability as consumers take​ out fewer loans. Among the bigger banks, Moody’s reasons for assigning a negative outlook varied ‍by lender.⁢ Some, ⁤such as U.S. Bancorp and Truist Financial, have low capital buffers, while others, like ⁢State‌ Street and BNY ‍Mellon,⁢ have experienced large deposit outflows.

Moody’s has⁣ downgraded the credit ratings of 10 midsized banks by one‌ notch. These banks include ​M&T Bank (MTB) and Webster Bank (WBS),⁢ among others.

2023-08-08 10:31:07
Post from www.investopedia.com
rnrn