The Standard & Poor’s Global credit rating agency downgraded the ratings and outlooks for seven regional US banks on Monday, Reuters reported.
The agency cited a “sharp rise in interest rates by the US Federal Reserve” as the possible cause for a surge in funding deposit costs.
The ability of the banks to stand up to difficulties in the commercial real estate (CRE) sector was also questioned.
S&P cut its ratings on Associated Banc-Corp, Valley National Bancorp, UMB Financial Corp, Comerica Bank and KeyCorp.
The agency downgraded the outlook for S&T Bank and River City Bank, from “stable” to “negative,” citing higher CRE exposure.
Earlier this month, Moody’s credit rating agency cut its ratings by one notch on 10 US banks, and placed six on review for potential downgrades, including Bank of New York Mellon, US Bancorp, State Street and Truist Financial.
