US banks 'under threat from eurozone'

17 November 2011

US banks remain under threat due to the effects of the ongoing eurozone debt crisis, a new report has stated.

According to research published by ratings agency Fitch, the risk of the financial problems engulfing member states such as Greece and Italy at present spreading to other nations means financiers in America could face difficulties in the near future.

Fitch explained that while US banks currently have "manageable direct exposures to the stressed European markets", the fact that "further contagion poses a serious risk" to such organisations cannot be avoided.

Indeed, the agency added unless the crisis is resolved in a "timely and orderly manner", there is a real chance that the "broad credit outlook for the US banking industry could worsen".

Recently, a report by the Federal Reserve Bank of San Francisco noted that America is presently likely to endure a recession in 2012.

By Claire Archer

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