Ratings agency Moody’s has downgraded the credit ratings of Canada’s biggest bank – the Royal Bank of Canada, Royal Bank of Scotland, Barclays and HSBC and a few other institutions with global operations.

There are concerns that the move by Moody’s will add to funding pressures for credit-hit banks, potentially making it harder for them to borrow money commercially. The credit rating agency – Moody’s Investors Service, which forewarned banks and the other institutions about four months ago that a downgrade was possible, cut the credit scores of banks to new lows to reflect new risks that the industry has encountered since the financial crisis.

‘ While Moody’s has changed their overall view of the capital markets industry, RBC Capital Markets has been consistently profitable, thanks to a strategic and measured approach to growth and prudent risk management. ‘ Royal Bank of Canada said in a statement.

Credit Rating Agency Moody’s Downgrades 15 Banks / Moody’s cut the credit ratings of some of the world’s largest financial institutions

Moody’s divides the 15 world’s banks into 3 main groups :  the top group, which had the highest ratings as JP Morgan, HSBC and Royal Bank of Canada to have stable businesses sufficient. The second group were Goldman Sachs, Deutsche Bank and Credit Suisse. The credit rating agency Moody’s explained that some of this institutions still managed risk indeed even though they really consist on their markets businesses to grafity their shareholders. And group number three, the weakness fraction and included Bank of America, Citigroup, Morgan Stanley and Royal Bank of Scotland. Rating agency Moody’s said these banks have either had ‘ problems in risk management or have a history of high volatility, ‘ and some of them have completed business strategy changes.

Mark Grant – managing director at Southwest Securities Inc. said : ‘ The biggest surprise is the three-notch downgrade of Credit Suisse, which no one was looking for. In fact, it was Morgan Stanley that was supposed to be downgraded by that amount and Morgan received only two notches of cuts. ‘

Banks leaders are strongly disagrees with Moody’s ratings change / credit ratings agency Moody’s has downgraded 15 global banks and financial institutions, analyses of investment

Spokesman of Citigroup said : ‘ We have been especially surprised by Moody’s disproportionately adverse treatment of United States firms relative to banks in Europe. ‘ In downgrading Citigroup, Moody’s agency said it contemplated the bank’s changeable earnings and the problems it had managing risk in the financial crisis.

Ahead of the Moody’s downgrades, corporate treasurers had silently precipitated their own reviews of where to put their bank deposits, who they trade swaps with and who they borrow from.

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