S&P Global Cuts Multiple Credit Ratings of US Banks

S&P Global cuts credit ratings of multiple U.S. banks on Monday and revised its outlook in a sign of warning that credit rating companies are reviewing the strength of the U.S. financial sector.

Associated Banc-Corp and Valley National Bancorp was downgraded by S&P on Monday on funding risks and a higher reliance on brokered deposits.

Meanwhile, UMB Financial Corp, Comerica Bank and Keycorp were also downgraded due to large deposit outflows and high interest rates.

S&P Global wrote in a note stating that a sharp rise in interest rates is weighing on many U.S. banks’ funding and liquidity. The credit agency expected deposits held by Federal Deposit Insurance Corp-insured banks will continue to decline if the central bank continues its quantitative tightening.

The downgrade came after Moody’s cut credit ratings of the U.S. banks earlier due to similar concerns after the collapse of Silicon Valley Bank.