Royal Bank of Scotland’s credit rating was downgraded by Moody’s Investors Service after the lender reported its biggest full-year loss since its bailout in 2008.
Bloomberg reports that RBS was cut to Baa2, the second-lowest investment grade, from Baa1, and the outlook is negative, Moody’s said in a statement today. The bank’s credit rating had been on review since February 12th.
RBS Chief Executive Officer Ross McEwan outlined plans to return the bank to profit when it posted full-year results on February 27th. The lender will reduce risk-weighted assets in its international banking and securities unit by about a third by 2020.
The downgrade 'better reflects the risk the restructuring poses to bondholders, together with the bank’s constrained financial flexibility during the restructuring period', Moody’s said.
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