First the U.S. gets its credit rating downgraded, and now a bunch of banks just did.
It’s a different major credit rating agency that downgraded the banks — Moody’s, not Fitch. But it’s still bad news, especially after the bank failures earlier this year.
Moody’s said this week that it lowered the credit ratings of 10 small and midsized banks that are facing growing financial risk and strained profitability. And it put several bigger banks on notice, although it hasn’t decided to downgrade them yet.
When a bank’s credit rating drops, it can lose access to some loans and becomes less willing to lend money itself. Nervous consumers may also be less likely to bank there and take their deposits elsewhere, which is what caused Silicon Valley Bank to collapse in March.
Following are the banks that were put on notice and those with a newly diminished credit rating.
Bigger banks put on notice
The larger financial institutions that Moody’s put under review for potential downgrading of their credit ratings include:
- Bank of New York Mellon
- Northern Trust
- State Street
- Cullen/Frost
- U.S. Bancorp
- Truist Financial
Up next are the newly downgraded ratings of, and the outlooks for, the smaller institutions on which Moody’s took action.
Commerce Bank
Year this financial institution was established: 1984
Headquartered in: Kansas City, Missouri
Number of locations: 164 across seven U.S. states
Moody’s rating action: Downgraded long-term issuer to A3 from A2
Moody’s outlook: Stable
BOK Financial
Year this financial institution was established: 1910
Headquartered in: Tulsa, Oklahoma
Number of locations: 117 across eight U.S. states
Moody’s rating action: Downgraded long-term issuer to Baa1 from A3
Moody’s outlook: Stable
M&T Bank
Year this financial institution was established: 1856
Headquartered in: Buffalo, New York
Number of locations: 1,057 across 15 U.S. states and three foreign locations
Moody’s rating action: Downgraded senior unsecured to Baa1
Moody’s outlook: Stable
Old National Bank
Year this financial institution was established: 1907
Headquartered in: Evansville, Indiana
Number of locations: 271 across seven U.S. states
Moody’s rating action: Downgraded senior unsecured to Baa1 from A3
Moody’s outlook: Negative
Prosperity Bank
Year this financial institution was established: 1949
Headquartered in: El Campo, Texas
Number of locations: 325 across two U.S. states
Moody’s rating action: Downgraded long-term deposits to A1 from Aa3
Moody’s outlook: Stable
Amarillo National Bank
Year this financial institution was established: 1892
Headquartered in: Amarillo, Texas
Number of locations: 33 across one U.S. state
Moody’s rating action: Downgraded issuer to Baa2 from Baa1
Moody’s outlook: Stable
Webster Bank
Year this financial institution was established: 1870
Headquartered in: Stamford, Connecticut
Number of locations: 199 across four U.S. states and one foreign location
Moody’s rating action: Downgraded long-term issuer to Baa2 from Baa1
Moody’s outlook: Stable
Fulton Bank
Year this financial institution was established: 1882
Headquartered in: Lancaster, Pennsylvania
Number of locations: 214 across five U.S. states
Moody’s rating action: Downgraded long-term issuer to Baa2 from Baa1
Moody’s outlook: Negative
Pinnacle Bank
Year this financial institution was established: 1934
Headquartered in: Elberton, Georgia
Number of locations: 25 across one U.S. state
Moody’s rating action: Downgraded long-term issuer to Baa2 from Baa1
Moody’s outlook: Changed to negative
Associated Bank
Year this financial institution was established: 1874
Headquartered in: Green Bay, Wisconsin
Number of locations: 206 across three U.S. states
Moody’s rating action: Downgraded subordinate to Baa3 from Baa2
Moody’s outlook: Stable
