S&P, Fitch weighs in on financial institutions

Standard & Poor's, Fitch and Moody's have taken their lumps in this credit crunch. S&P just issued an update on financial institutions, which notes that third-quarter earnings will likely reflect the turmoil. But it also noted that there are many companies poised to stand up well longer-term. Not all are in that category. It has taken action on various bond classes and mortgage companies, notable Countrywide and Thornton (not soon enough for some critics). But despite the uncertainty and the upheaval in the CDS market, the S&P and Fitch, which took a look at hung loans, remains positive on the big names, which are sufficiently diversified and liquid. Morgan Stanley was actually upgraded recently. Retail oriented banks with lots of perceived exposure also make the list: Wells Fargo, HSBC and Wachovia. S&P also notes that it did not boost credit ratings in 2003-2004, when the industry was humming.  

For more:
- here's the update from S&P
- here's more about Fitch's views from the AP

Related articles:
- More on credit rating agencies
- Credit rating agencies still in harsh spotlight