https://sputnikglobe.com/20230815/fitch-analyst-says-rating-agency-could-downgrade-us-banks-1112615413.html
Fitch Analyst Says Rating Agency Could Downgrade US Banks
Fitch Analyst Says Rating Agency Could Downgrade US Banks
Sputnik International
Fitch Ratings could downgrade more than 70 US banks including JP Morgan Chase if the banking industry suffers another downgrade, Fitch analyst Chris Wolfe told an American news agency in an interview on Tuesday.
2023-08-15T14:18+0000
2023-08-15T14:18+0000
2023-08-15T14:18+0000
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On June 27, Fitch downgraded its assessment of the US banking industry's operating environment from AA to AA-, citing "gaps in the regulatory framework and structural uncertainty around the normalization of monetary policy." Another downgrade would force Fitch to re-evaluate all of the lenders it covers, the analyst said. Wolfe explained that the main problem with a recalibration of ratings would be that the industry’s score would be lower than their top-rated lenders. Thus, financial institutions such as JPMorgan and Bank of America would fall to AA- from A+, as banks cannot have higher ratings than the environment they operate in. The analyst declined to speculate on the timing of the potential move, nor would he comment on the impact it could have on lower-rated firms. In late June, Fitch Ratings announced that it downgraded the credit rating of the United States from AAA to AA+, citing "a steady deterioration in standards of governance." The rating agency also said that it found troubling the debt limit standoffs between the two major political parties in Congres, despite their last-minute resolutions to avoid a debt default.
https://sputnikglobe.com/20230802/what-are-fitch-ratings-and-what-does-uss-downgrade-mean-for-other-nations-1112344239.html
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debt ceiling; credit rating; fitch, fitch ratings, sovereign credit rating, rating, credit, debt, downgrade, united states, aaa, what are fitch ratings, why is a country's credit rating important, how do credit ratings affect market psychology, are ratings politicized, who has aaa ratings, bill on debt ceiling, suspends debt ceiling, government borrowing, us government default, imminent us default, new caps on federal spending
Fitch Analyst Says Rating Agency Could Downgrade US Banks
WASHINGTON (Sputnik) – Fitch Ratings could downgrade more than 70 US banks including JP Morgan Chase if the banking industry suffers another downgrade, Fitch analyst Chris Wolfe told an American news agency in an interview on Tuesday.
On June 27, Fitch
downgraded its assessment of the US banking industry's operating environment from AA to AA-, citing "gaps in the regulatory framework and structural uncertainty around the normalization of monetary policy." Another downgrade would force Fitch to re-evaluate all of the lenders it covers, the analyst said.
“If we were to move it to A+, then that would recalibrate all our financial measures and would probably translate into negative rating actions,” Wolfe clarified.
Wolfe explained that the main problem with a recalibration of ratings would be that the industry’s score would be lower than their top-rated lenders. Thus, financial institutions such as JPMorgan and Bank of America would fall to AA- from A+, as banks cannot have higher ratings than the environment they operate in.
The analyst declined to speculate on the timing of the potential move, nor would he comment on the impact it could have on lower-rated firms.
In late June, Fitch Ratings announced that it downgraded the credit rating of the United States from AAA to AA+, citing "a
steady deterioration in standards of governance." The rating agency also said that it found troubling the
debt limit standoffs between the two major political parties in Congres, despite their last-minute resolutions to avoid a debt default.
