Credit ratings agency Standard & Poor's said Friday it slashed the ratings on 11 U.S. and European banks by either one or two notches, while cutting the outlook on a 12th bank after revising its view on the troubled sector.
S&P cut ratings on Bank of America, Barclays Bank, Citibank, Credit Suisse, Deutsche Bank, Goldman Sachs, JPMorgan Chase Bank, Morgan Stanley, Royal Bank of Scotland, UBS and Wells Fargo Bank.HSBC Bank's outlook was revised to negative, though its rating remained unchanged.
All 12 banks still carry investment-grade ratings. The banks' ratings range between "A" and "AA+."
Banks are facing increasing industry risk amid the deepening economic slowdown, and that is likely to affect their future performance, S&P said. In revising its ratings, S&P increased the sensitivity of reliance on short-term wholesale funding into banks' ratings analysis. S&P now expects higher levels of stress on the sector during this downturn than in past slowdowns.
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