Government Risk Guarantee Questioned, Big Banks Downgraded
The largest “too big to fail” banks were downgraded by Standard & Poor’s Wednesday based on the diminishing potential for a U.S. government bailout to come to the rescue when the next banking crisis occurs. The move has wide implications and raises questions as to the significance placed on a U.S. government assistance in the ratings formulas.
Banks might no longer have government derivatives risk guarantee as they get downgraded
JPMorgan, Bank of America, Citigroup, Wells Fargo, Goldman Sachs, Morgan Stanley and BNY Mellon were all downgraded one notch with the title of the S&P . . .
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