Abstract: The major European banks are battling a range of rating pressures. The prospect of higher loan losses driven by the economic downturn, the hits on capital from market turmoil, and reduced investor appetite for the banking sector are all contributing to weaker financial profiles. Although wholesale banking losses (and other write-downs of structured finance investment portfolios) continue to be high, they are likely to be in line with the expectations factored into existing ratings. The focus is now shifting to the emerging problems in traditional loan books as the European economies enter into a downturn at varying speeds. Standard&Poor's Ratings Services expects to see these economic pressures reflected first in slower lending and revenues before we see significant

Brief Excerpt: RESEARCH Ratings Definitions Industry Report Card: Credit Losses, Capital, And Confidence--A Sharp Economic Downturn Adds To Pressures On Major European Bank Ratings Publication date: 24-Jul-2008 Primary Credit Analyst: Michelle Brennan,...

Report Type: Commentary
Sector: Global Issuers, Public Finance, Structured Finance
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 S&P Credit Research
S&P Credit Research provides analysis on issuers and debt obligations of corporations, states and municipalities, financial institutions, insurance companies and sovereign governments. S&P also offers insight into the credit risk of structured finance deals, providing an independent view of credit risk associated with a growing array of debt-securitized instruments.