JPMorgan, Bank of America and Citigroup are among eight large U.S. banks that had credit grades cut one level by Standard & Poor’s on the prospect that the U.S. government is less likely to provide aid in a crisis.
Bloomberg News reports that after signalling the move last month, S&P lowered its long-term issuer credit, senior unsecured, and non-deferrable subordinated debt ratings, according to a statement Wednesday. Firms affected also include Wells Fargo, Goldman Sachs, Morgan Stanley, Bank of New York Mellon and State Street.
'We now consider the likelihood that the U.S. government would provide extraordinary support to its banking system to be ‘uncertain’ and are removing the uplift based on government support from our ratings', S&P said in the statement. It had put the companies on negative credit watch November 2 as it reviewed regulatory changes.
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