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Published in Business and Finance on Tuesday, June 26th 2012 at 5:27 GMT by Market Wire

June 26, 2012 08:20 ET
"Big Banks" Shares Rebound a Day After Moody's Ratings Cuts
Five Star Equities Provides Stock Research on Citigroup and JPMorgan
NEW YORK, NY--(Marketwire - Jun 26, 2012) - U.S. bank stocks posted solid gains last Friday, despite Moody's Investors Service cutting the credit ratings of 15 banks globally. "It's been like a cloud over the sector," said Brian Gendreau, market strategist at Cetera Financial. "And look at who's going up: bank stocks. There are obviously some people who thought it would be much worse." Five Star Equities examines the outlook for companies in the Banking Industry and provides equity research on Citigroup Inc. (
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Of the six largest U.S. banks, only Wells Fargo maintained its credit rating. The revenues of the 5 major U.S. banks that received cuts -- JPMorgan, Bank of America, Citigroup, Goldman Sachs and Morgan Stanley - decreased 11 percent from the year prior. The rating cuts by Moody's were the first since the financial crisis. Morgan Stanley emerged as "the clear winner" according to analysts at investment bank Keefe Bruyette & Woods. Many analysts were expecting Morgan Stanley's rating to be cut by three notches instead of the two it received.
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"These downgrades will increase the cost of doing business for banks, either through reduced, or more costly, access to funding or the need to lodge extra collateral with creditors," said Daiwa Capital Markets analyst Michael Symonds
HSBC, Royal Bank of Canada and JPMorgan were the banks that received the highest ratings from Moody's Investors Service. The trio has been regarded as "safe-haven" banks as they are funded by deposits from millions of retail customers and rely less heavily on risky capital markets. Banks such as Bank of America, Citigroup, Morgan Stanley and Royal Bank of Scotland received some of the lowest credit ratings.
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