S&P planning credit rating updates

18 November 2011

Leading banks around the world could see their ratings cut as Standard & Poor's (S&P) is planning to review their credit scores before the end of the year.

The agency is set to update its figures for the 30 biggest banks across the globe within the next three weeks - and it is thought that several lenders may experience a downgrade.

For instance, Baylor Lancaster of CreditSights feels Citigroup, Morgan Stanley and Bank of America could all be under threat, while numerous banks in Europe may also face a reduction.

This round of evaluations will be the first by S&P - which has offices in 23 countries - using its new system after its previous methods were widely criticised as being too positive.

Beate Muenstermann of JP Morgan Chase & Co indicated there are likely to be some surprises on the basis that the updated system is "very complex", which has made it "very difficult to simulate results".

By Tony Aynsley

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