Nomura Securities on Brokers & Asset Managers: Thoughts on Moody’s downgrade of BofA (BAC) and Citi (C)
Tweet
Share
E-mailGet Alerts BAC Hot Sheet
Price: $62.06 +0.32%
Rating Summary:
26 Buy, 18 Hold, 2 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
26 Buy, 18 Hold, 2 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Join SI Premium – FREE
Nomura Securities on Brokers & Asset Managers: Thoughts on Moody’s downgrade of BofA (NYSE: BAC) and Citi (NYSE: C) by Glenn Schorr
Schorr said, "These downgrades should not come as a surprise. Given the long lead time, we think the banks have reduced reliance on CP, built up significant liquidity buffers, reduced repo on less-liquid assets, termed out repo at the broker-dealer subs, moved as much business as possible to their highly-rated bank subs, prepared key counterparties and pre-funded much of their funding needs over the next 12 months. While things may not go perfectly smoothly, we do not expect any liquidity issues for the firms from the P-2 ratings. For BAC, we think the Baa1 LT rating could have some potential business impacts over time in areas such as long-dated derivatives, and it will likely face higher funding costs versus peers."
Schorr said, "These downgrades should not come as a surprise. Given the long lead time, we think the banks have reduced reliance on CP, built up significant liquidity buffers, reduced repo on less-liquid assets, termed out repo at the broker-dealer subs, moved as much business as possible to their highly-rated bank subs, prepared key counterparties and pre-funded much of their funding needs over the next 12 months. While things may not go perfectly smoothly, we do not expect any liquidity issues for the firms from the P-2 ratings. For BAC, we think the Baa1 LT rating could have some potential business impacts over time in areas such as long-dated derivatives, and it will likely face higher funding costs versus peers."
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Advance Auto Parts (AAP) PT Lowered to $48 at DA Davidson Following 25% Selloff Post Q2 Results
- DA Davidson Starts Comfort Systems USA (FIX) at Buy
- DA Davidson Starts Everus (ECG) at Buy
Create E-mail Alert Related Categories
Analyst Comments, DowngradesRelated Entities
Citi, NomuraSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
