Tiny but I think the best ratings firm Egan-Jones today downgraded France’s credit rating and put it on negative credit watch. S&P and Moody’s still have it AAA but E-J had already cut it to AA- and reduced that today to A.
S&P “too big to fail” bank credit downgrades
BofA from AA- to A
B of NY AA- to A+
Citigroup from A to A-
Goldman Sachs A to A-
JP Morgan Chase from A+ to A
Morgan Stanley A to A-
Wells Fargo from AA- to A+
That puts 3 of the big 7 banks a half-step away from BBB+ and 4 steps away from junk status. These downgrades are causing banks to have to put up more collateral on derivative contracts or to cancel them, making life more difficult and less profitable.
On the other hand, bank lending has gone up slightly after having decreased the month before.