Moody’s reportedly downgraded the debt ratings of Signature Bank deeper into junk territory and rated its subordinate debt ‘C’. Apart from this, ratings of six other US banks are being reviewed by the rating agency for a downgrade.
According to Moody's, the banks under surveillance are First Republic Bank, Zions Bancorporation, Western Alliance Bancorp, Comerica Inc, UMB Financial Corp and Intrust Financial Corporation, reported Reuters. Moody’s said that it will also withdraw future ratings for the Signature Bank.
Signature Bank had 40 branches across the US in New York, California, Connecticut, North Carolina and Nevada. As per Live Mint, by the end of last year, Signature Bank had $110.4 billion and total deposits of $82.6 billion by December 31, 2022.
"I am firmly committed to holding those responsible for this mess fully accountable and to continuing our efforts to strengthen oversight and regulation of larger banks so that we are not in this position again,” US President Joe Biden said in a statement on Sunday.
On Sunday, Signature Bank was shut by the state regulators making it the third largest failure in U.S. banking history. Earlier, Silicon Valley Bank (SVB), whose main clients were startups and other tech companies was also closed by the authorities which led billions stuck in deposits. Before SVB was shut, it had assets worth $209 billion and deposits of $175 billion, The Indian Express reported.
Apart from this, crypto group Circle also admitted that it has $3.3 billion worth of its reserves with the bank. Crypto lender BlockFi also has $227 million stuck at SVB, Business Standard reported.