{"id":1995465,"date":"2023-08-09T14:15:01","date_gmt":"2023-08-09T18:15:01","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/moodys-slashes-credit-ratings-of-regional-banks-sees-recession-in-2024\/"},"modified":"2023-08-09T14:18:59","modified_gmt":"2023-08-09T18:18:59","slug":"moodys-slashes-credit-ratings-of-regional-banks-sees-recession-in-2024","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/moodys-slashes-credit-ratings-of-regional-banks-sees-recession-in-2024\/","title":{"rendered":"Moody&#8217;s downgrades regional banks, predicts 2024 recession."},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">14<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fmoodys-slashes-credit-ratings-of-regional-banks-sees-recession-in-2024%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1995465&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><h2>Moody&#8217;s Downgrades Credit Ratings of \u2064Regional American Banks<\/h2>\n<p>On Tuesday, Moody\u2019s Investors Service made a significant move\u200c by reducing the \u2064credit\u2064 ratings of \u2062ten regional American <a href=\"https:\/\/www.dailywire.com\/topic\/banks\">banks<\/a>. This decision has \u200balso put many other bigger banks at \u2064risk of being downgraded.<\/p>\n<h3>The\u200c Affected Banks<\/h3>\n<p>The ten banks \u200btargeted by\u200c Moody\u2019s include \u200cAmarillo National Bancorp, BOK Financial, Commerce Bancshares, Fulton \u200cFinancial, \u2063M&#038;T Bank, Old \u200bNational\u2062 Bancorp, Pinnacle Financial Partners, Prosperity Bancshares, \u2064and Webster Financial. The repercussions of this action \u2062were \u200dimmediately\u200b felt, as shares of major\u2064 banks such as JPMorgan, Bank of America, \u200dCitigroup, and \u2064Wells\u200b Fargo \u2064plunged.<\/p>\n<h3>Further Review and Negative Outlook<\/h3>\n<p>Moody\u2019s Investors Service has also\u200d announced that\u200d it will review the ratings of six other institutions,\u200d including Bank\u200d of New York \u200cMellon, Northern \u200cTrust, State Street, and \u200bUS Bancorp. Additionally, Moody\u2019s has assigned \u2062a \u2063negative outlook to 11 other banks, as\u200c reported by <a href=\"https:\/\/www.wsj.com\/articles\/global-stocks-markets-dow-news-08-08-2023-f2a80b95?mod=hp_lead_pos2\" target=\"_blank\" rel=\"noopener\">The Wall Street Journal<\/a>.\u2063 The Dow \u2063Jones \u2062Industrial average experienced a \u2062significant drop of 3.75% in response to these \u2063developments.<\/p>\n<h3>Reasons Behind \u2064the Downgrades<\/h3>\n<p>Moody\u2019s\u2064 has justified its decision by pointing \u200bout the growing profitability pressures faced by many banks in their second-quarter results. These pressures are expected to \u2063reduce their ability to generate\u200b internal \u200bcapital. Moody\u2019s also predicts a mild U.S. recession on\u200c the horizon for early 2024, with potential risks\u2062 in some <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/moodys-slashes-credit-ratings-of-regional-banks-sees-recession-in-2024\/\" title=\"Moody's downgrades regional banks, predicts 2024 recession.\">banks&#8217; commercial real estate portfolios<\/a>. The\u2062 tightening in monetary policy and an <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/parts-of-the-yield-curve-just-inverted\/\" title=\"Parts of the Yield Curve Just Inverted\">inverted yield curve<\/a> have further \u200bimpacted banks&#8217; profitability and ability to generate capital internally, according to Moody&#8217;s analysts.<\/p>\n<p>However, Ana Arsov,\u200b managing \u2062director of financial institutions at Moody\u2019s, clarified that this move is not \u2064indicative of a broken banking\u200b system.\u2062 She \u200demphasized that it is primarily a profitability story \u200band does not \u2064raise major\u200c concerns \u200dabout the \u2063system\u200d being undercapitalized or underfunded.<\/p>\n<h3>Challenges Faced by Banks<\/h3>\n<p>The release\u200d of non-interest bearing deposits\u2063 triggered \u200bby the 2023 financial situation has affected the <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/futures-pare-gains-as-bank-stocks-drag-on-svb-contagion-fears\/\" title=\"Futures pare gains as bank stocks drag on SVB contagion fears\">net interest margins<\/a> of banks. This refers to the difference between the interest banks earn \u2062on loans and\u2064 the interest depositors earn.\u2064 Investopedia\u200b <a href=\"https:\/\/www.investopedia.com\/moody-s-downgrades-credit-ratings-for-10-banks-puts-six-others-on-notice-7571278#citation-1\" target=\"_blank\" rel=\"noopener\">noted<\/a> that most banks are troubled by\u2063 high loan-to-deposit ratios, which could\u2064 leave them vulnerable to\u2063 insufficient liquidity.<\/p>\n<p>In May,\u2062 the failure of First\u2063 Republic Bank,\u2062 the <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/silicon-valley-bank-shut-down\/\" title=\"Silicon Valley Bank shut down\">largest bank failure<\/a> since Washington Mutual in 2008, marked a\u200b significant event\u200d in U.S.\u200c banking\u200b history.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>On Tuesday, Moody&#8217;s downgraded credit ratings of ten regional US banks and warned of possible downgrades for larger banks. The affected banks include Amarillo National Bancorp, BOK Financial, Commerce Bancshares, Fulton Financial, M&amp;T Bank, Old National Bancorp, Pinnacle Financial Partners, Prosperity Bancshares, and Webster Financial. JPMorgan&#8217;s shares were impacted.<\/p>\n","protected":false},"author":60,"featured_media":1995466,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[541],"tags":[],"class_list":["post-1995465","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-daily-wire"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1995465","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/60"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1995465"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1995465\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/1995466"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1995465"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1995465"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1995465"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}