Banks placed on watch list
Seven major banks, including some of the biggest investors historically in the casino industry, have been placed on a negative ratings watch for long- and short-term debt by Fitch, one of the nation’s three credit rating agencies, Forbes.com reported.
The list includes Morgan Stanley, Goldman Sachs, Credit Suisse and Deutsche Bank, each of which helped syndicate loans for casino developers during the construction boom of the past 20 years. A downgrade could make it more expensive for the banks to raise future capital.
Fitch lists financial volatility as a factor behind the focus on the banks, Forbes noted.
“These seven banks are among the largest global trading and universal banks,” a statement released by the ratings agency said. “Trading businesses exhibit high reliance on short-term wholesale funding and to varying degrees what Fitch views as more volatile earnings than commercial banking, and with more opaque risk.”
Others on the list include Barclays PLC, Societe Generale and BNP Paribas.