...Since the start of the credit crunch, Moody s has taken negative rating actions on a number of U.S. banks. A few have ev en been subject to multiple notch downgrades. In the majority of cases, rating actions were driven by an apparently weak capital position in light of t he challenging operating environment and estimated stress losses on certain asset classes. When they entered the illiquid market of the second half of ####, U.S. banks capital positions were not robust. In Mood y s view, there are still institutions where capital levels may be insufficient considering their risk profiles. As a result, banks capital levels and capital management flexibility continue to weigh on ratings given continuing market volatility. Chart # shows the decline in capital ratios for U.S. banks rated by Moody s through year-end ####. Our capital analysis of U.S. banks incorporates a number of metrics. Key ratios are tangible common equity ...

Report Type: Special Comment
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 Moody's Global Credit Research
Moody's Investors Service, a leading global credit rating, research and risk analysis firm, publishes credit opinions, research, and ratings on fixed-income securities, issuers of securities and other credit obligations. Credit ratings and research help investors analyze the credit risks associated with fixed-income securities. Ratings also create efficiencies in fixed-income markets and similar obligations, such as insurance and derivatives, by providing reliable, credible, and independent assessments of credit risk. For issuers, Moody's services increase market liquidity and may reduce transaction costs.