UK Banks Slapped With Credit Downgrades
Credit ratings agency Moody's has confirmed it is downgrading major UK banks and other global financial institutions because of their exposure to Europe's economic turmoil.
The move potentially adds billions of pounds to the funding costs of the 15 institutions affected, which include Barclays, HSBC, RBS and Lloyds.
Among the others downgraded are Goldman Sachs, JPMorgan Chase, Bank of America, Citigroup, Societe Generale, Credit Agricole and Deutsche Bank.
Sky's City editor Mark Kleinman earlier exclusively revealed that the announcement would be made after US markets closed for business on Thursday.
He said: "This is going to have some impact on the funding costs of these banks.
"I think there'll be some relief in the City (on Friday) that the downgrades weren't more severe because it's certainly possible that Moody's could have gone further."
Banks have been under scrutiny amid the pressure facing the industry from the effects of the global financial crisis.
Kleinman said the move is part of the agency's wider reassessment of the health of banks.
The major ratings agencies have rushed to downgrade banks across the Continent in recent months, particularly as the eurozone's problems have intensified.
A cut last month to the credit rating of Santander UK, the Spanish-owned lender, triggered speculation about the safety of customers' savings which was quickly dismissed by the bank.
The latest wave of downgrades will bring many of the other UK banks in line with Santander UK and there will be no resulting impact on the security of their savings.
The downgrades range in scope from one notch to two notches depending on the particular institution.
As predicted, Barclays was given a two-notch downgrade, while HSBC, RBS and Lloyds were downgraded by one notch.
On Thursday bank shares lost value in late trading on the FTSE 100, with RBS the biggest faller of the main UK banks.
what do you think?
Who or what is Moodys? Never heard of them other than they downgrade banks/countries. It sounds extremely pompous and worthless.
Something else which affects us but nobody explains how. Like news items on economics which may as well be read out in Swahili for how much the general public understands it.
Sounds a bit Illuminati-ish to me. Lots of funny handshakes and old men meeting in darkened corners.
Moody's is a credit-rating company. They research the 'creditworthiness' of lenders - in short, they are among some of capitalism's witchdoctors, and are an utter nonsense, yet banking systems can run into panic stations on their say so and thus cause all sorts of trouble like lack of investments, that leads to job cuts and all the other rigmarole. Free market capitalism, huh? Don't you just love it? Further proof, if proof were needed that capitalism has failed and we need a new model to run our society, something rational, logical and democratically planned.
Didn't Moody play the part of Fagin in Oliver ? Seems appropriate.
You must understand the more that they downgrade everyone, the more money they make, let us all cheer when they get downgraded themselves, lets hope that this is possible
The more the banks credit rating is down graded the higher the interest they pay on money borrowed which will then be passed on to those who borrow or have borrowed from the banks. It will also make it more difficult for banks to borrow and lend This is not good news for banks of borrowers
So these people enjoy bringing down countries, what planet do they live on?
Moody`s insider`s doing illegal transfer`s out of hours ,nice way to get rich quick.Only the 1% apply.
Ronald George Halliday
Maybe governments should investigate these ratings agencies and the way they come up with these downgrades, or nationalise the whole banking industry worldwide. Not a good scenario we know, but at least it might stabilise the industry into a more productive and less reckless manner.
.......ITS ALL THAT COMEDIAN CARRS FAULT !!!!!!!
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