Feb 16, 2012 – New York— AP Moody’s Investors Service may lower the ratings of some of the world’s largest banks, as well as those of some securities firms, because their long-term prospects for profitability and growth are shrinking.
The ratings agency said that it is concerned that banks with significant capital market activities are dealing with challenges such as widening credit spreads, delicate funding conditions and increased regulatory requirements and restrictions. Some of the risks facing banks have been mitigated by increased regulatory capital and liquidity requirements, but they have not gone away completely, Moody’s said.
Moody’s also extended ongoing reviews for downgrades on 11 companies, which include Credit Suisse, Macquarie, Nomura, UBS, Barclays, BNP Paribas, Credit Agricole, Deutsche Bank, HSBC, Royal Bank of Scotland and Societe Generale. Nine of these institutions are among the 114 European banks that Moody’s is reviewing ratings for. The European banks are located in 16 countries, with the largest number — 24 — headquartered in Italy. That is followed by Spain, which has 21 banks on the list.
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