Moody's Downgrades Bank Of America On Less Probability Of US Support |
| Wall Street Journal - Sep 21, 2011 |
Moody's Investors Service downgraded Bank of America Corp.'s (BAC) long-term debt two notches, finishing a more than three-month review by saying it believes the U.S. government is less likely to support the bank if needed.
Shares fell 5.5% to $6.52 in recent trading.
In a statement, Bank of America said it disagreed with Moody's conclusions.
The firm said the probability that the government would allow a large bank to fail is greater now than it was during the financial crisis. While it said it the government is likely to continue to provide some level of support to systemically important financial institutions, the risks of failure contagion are less acute. As a result, Moody's reduced the amount of support it incorporates into Bank of America's ratings to levels reflected prior to the crisis.
Moody's specifically noted that the downgrades didn't reflect a weakening in Bank of America's intrinsic credit quality.
Moody's downgraded Bank of America's long-term senior debt two steps to Baa1, which is three notches above junk territory. The downgrade finished the firm's review for a cut, and the outlook on the new rating is still negative.
Read Full Article from Wall Street Journal
- Posted: 2011-09-21 12:14:43
| More Stock Investor Place Company News |
 |
|
|
|
| Stock Investor Place Company News Archive |
|
|
|
