NEW YORK (Reuters) - Moody’s Investors Service on Thursday cut the credit rating of Lloyds TSB Bank Plc, part of a review of global banking systems that has seen cuts to financial institutions around the world.
The rating agency cut its Lloyds TSB Bank senior debt and deposit ratings by one notch to A2 from A1, the same day that it also downgraded the ratings for 15 global banks.
The rating carries a negative outlook.
Moody’s cited several reasons for the cut, including Lloyds’ sensitivity to challenges in the UK and Europe. Moody’s also cited mitigating factors, such as strong capital ratios.
“The current rating level and outlook incorporate a degree of expected further deterioration in the bank’s operating environment and the likelihood that changes in investors’ sentiment could further weaken its standalone credit profile,” Moody’s said in a statement.
“Any reduction in the likelihood of systemic support for large UK banks could exert downwards pressure on the Lloyds’ ratings,” the statement noted.
Reporting By Luciana Lopez and Pam Niimi; Editing by Leslie Adler