Rating downgrades for global banks increased in the fourth quarter as sovereign debt concerns in Europe rose, Fitch Ratings says,

The number of downgrades rose to 36 from 28 in the quarter, while the number of rating upgrades remained constant, the rating agency says.

Half of the downgrades were due to continued sovereign debt concerns in Europe.

Only 25 banks, mostly in emerging Eastern Europe, had their ratings upgraded.

Fitch also says that the number of banks placed on rating watch negative almost doubled to 31 in the quarter. For some this was due to the impact of U.S. regulatory reform, while several Greek and Irish banks were placed on rating watch negative following a similar move on their respective sovereign ratings.

Fitch says that it expects the majority of global bank ratings to be stable, and that the ratio of positive to negative outlooks also continued to improve globally. Emerging Asia and Turkey saw significant improvements in their outlook ratios, while the ratio deteriorated in developed Europe.

IE