This story has been updated to reflect that the Fitch debt downgrades on PacWest, Trustmark and Western Alliance took place in April. Credit rating agency Fitch Ratings on Thursday said it completed a review of the debt of 14 small and mid-sized banks in its coverage and said no further downgrades appear to be needed at the current time.
The review was wrapped up after Fitch downgraded debt of three banks in recent weeks. The downgrades came after a handful of regional banks suffered a flight of deposits and steep drops in stock prices on the heels of the collapse of Silicon Valley Bank in March. Fitch had previously affirmed the ratings of 11 banks and reduced its ratings only on “a subset of banks that experienced either deposit outflows notably in excess of peers or low tangible capital level,” according to a statement. Among the previous downgrades, Fitch had cut PacWest Bancorp
PACW,
+5.04%
to a junk rating of BB+ from BBB- on April 14. The rating action was primarily driven by PacWest’s “funding and liquidity profile, specifically reliance on non-core funding in the wake of the failure of Silicon Valley Bank,” Fitch said. A downgrade to junk may increase PacWest’s borrowing costs. Fitch had also downgraded Western Alliance Bancorp
WAL,
+1.06%
to BBB- from BBB+ on April 14, and …
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