Moody's Cuts Ratings Of 15 Banks Including Bank of America Corporation, Morgan Stanley Down Two Notches-Reuters

Reuters reported that Ratings agency Moody's downgraded 15 banks on Thursday, lowering credit ratings by one to three notches to reflect the risk of losses they face from volatile capital markets activities, but banks criticized the move as backward looking. Morgan Stanley had its long-term debt rating lowered by just two notches, one level less than had been expected. The downgrade left Morgan Stanley more highly rated than Bank of America Corp and Citigroup Inc., but a step below Goldman Sachs Group. Other banks downgraded by two notches were: Barclays PLC, BNP Paribas SA, Royal Bank of Canada, Citigroup, Goldman Sachs Group Inc, JPMorgan Chase & Co., Credit Agricole SA, and Deutsche Bank AG. Along with HSBC Holdings plc, ratings for Bank of America, Royal Bank of Scotland Group plc and Societe Generale SA were also cut by one notch. Nomura Holdings, Inc. and Macquarie Group Limited were included in an original list of global banks under review, but have already been downgraded. The long-term debt ratings cuts could increase funding costs for Morgan Stanley and other banks, and trading partners may ask for more collateral. But the impact could be muted since the changes were in-line with indications given by Moody's on how much the ratings were likely to be cut.