oody’s Investors Service placed six US banks on review for potential credit rating downgrades late Monday, in the wake of last week’s collapse of Silicon Valley Bank.
The credit ratings firm also downgraded Signature Bank deep into junk territory following that bank’s failure. Ratings downgrades can make it more expensive for companies to borrow money.
Moody’s warned it could similarly downgrade First Republic Bank (FRC), Zions (ZION), Western Alliance (WAL), Comerica (CMA), UMB Financial (UMBF) and Intrust Financial. The firm cited the “extremely volatile funding conditions for some US banks exposed to the risk of uninsured deposit outflows.”