Sunday, July 1, 2012

JPMorgan Trading Loss Drove Three-Level Standalone Cut

The US taxpayers are the only reason that Moody's didn't drop their JPMorgan rating three levels lower. I'm so glad we solved the "too big to fail" problem!

Source: Bloomberg

JPMorgan benefited from the assumption that there’s a “very high likelihood” the U.S. government would back the bank’s bondholders and creditors if it defaulted on its debt, according to the statement. Without the implied federal backing, JPMorgan’s long-term deposit rating would have been three levels lower and its senior debt would have dropped two more steps, Moody’s said.

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