Moscow. November 3. Rating Agency Standard & Poor’s has placed in the list on review for possible downgrade eight largest US banks after the proposal of the Federal reserve system to raise requirements for capitalization of FIS.
The rating action affected banks Goldman Sachs, Morgan Stanley, Bank of America, Citigroup (long-term ratings of “A-“), and JPMorgan (“A”), Wells Fargo, Bank of New York Mellon and State Street (“A+”).
According to a press release of the Agency, the Federal reserve proposed to add new amendments to the regulations relating to the General rate covering losses (total loss absorption capacity, TLAC) largest banks in the world. Under the proposal, banks will need to reserve at least 18% of risk weighted assets to be written off and converted into shares in the event of a crisis.
In other words, the fed offered to bail out the banks at the expense of means of private investors, but not at the expense of budget money, as it did during the recent financial crisis. Thus, support from the state will no longer be included in the ratings of FIS, which explains their placing in the list for review.
It is expected that the review will be completed by the end of this year.