Daily news
September 26, 2023

S&P downgrades multiple U.S. banks on growing liquidity worries

Standard & Poor's (S&P) Global Ratings has downgraded the long-term credit ratings of multiple U.S. banks on growing concerns over their liquidity. The downgrades affect Goldman Sachs, Morgan Stanley, Citigroup, Wells Fargo, U.S. Bancorp, Bank of America, PNC Financial Services Group, and Bank of New York Mellon. The ratings agency pointed to recent stress in global financial markets due to concerns over the coronavirus pandemic, which has resulted in higher levels of client activity and increased credit exposure for banks. S&P noted that these institutions have ample liquidity to cover near-term needs, but longer-term risks are still present. The ratings agency also stated that the banks have collectively taken steps to conserve capital, a move that should help them manage their liquidity. These downgrades signify a further tightening in credit conditions and are a sign that the banking system is feeling the strain of the coronavirus pandemic.