14 UK banks could see credit rating cut

| May 24, 2011 | 0 Comments

Moody’s Investors Service has today announced it is reviewing 14 UK banks and building societies for downgrade due to the withdrawal of Government support.

Elisabeth Rudman, a Moody’s Senior Credit Officer, said: “It has been initiated in response to ongoing guidance from the UK authorities (the Bank of England, the Financial Services Authority and the Treasury) that banks that fail in the future should not expect capital injections from the public purse.”

The Bank of England has already said that the Special Liquidity Scheme (SLS) will not be renewed when it expires in January 2012.

The SLS was introduced in April 2008 to boost the liquidity position of the banking system by allowing banks and building societies to swap their high quality mortgage-backed and other securities for UK Treasury Bills for up to three years.

Meanwhile, the banks whose ratings are to be reviewed for possible downgrade are: Bank of Ireland (UK) plc; Co-Operative Bank plc; Coventry Building Society; Lloyds TSB Bank plc; Nationwide Building Society; Newcastle Building Society; Norwich & Peterborough Building Society; Nottingham Building Society; Principality Building Society; Royal Bank of Scotland plc; Santander UK plc; Skipton Building Society; West Bromwich Building Society; Yorkshire Building Society.

Tags: , , , , , SLS, , , withdrawal

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