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S&P downgrades major US banks

The agency’s latest credit ratings downgrades include Bank of America, Goldman Sachs and JPMorgan Chase.
Nov 30th 2011, 3:04 PM 1,519 10

RATINGS AGENCY Standard and Poor’s has downgraded the credit ratings of 37 financial institutions, including some of the biggest banks in the US.

The US banks downgraded yesterday include Citigroup Inc, Wells Fargo, JPMorgan Chase, Goldman Sachs and Morgan Stanley.

S&P did not release details of its evaluation for each of the institutions, but is expected to release further details of the ratings changes today.

The agency also downgraded Bank of America’s commercial mortgage trust, citing a review of the structure of the trust’s dealings and the level of liquidity available to it.

Speculation has been growing over Bank of America’s ability to withstand further turbulence in the US or European economies, and it said recently that ratings downgrades could effect its access to the markets and “could likely have a material adverse effect on our liquidity”.

The banks shared fell to their lowest levels since March 2009 ahead of yesterday’s ratings announcement amid investor fears over the stability of the euro.

S&P said the changes to the 37 institutions’ ratings reflect its own updated criteria for banks which cover changes within the industry and the role of governments and central banks in finance worldwide.

- Additional reporting by the AP

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