The Zhitong Finance App learned that Moody's Investors Services lowered the debt rating outlook for Bank of America, including First Capital Credit (COF.US), PNC Financial Services Group (PNC.US), and FITB.US (FITB.US), saying the US banking industry is facing “multiple pressures.” The agency said sources of pressure include financing pressure, insufficient regulatory capital, and rising risks associated with commercial real estate exposure.

Moody's said, “The second-quarter earnings reports of US banks show a sharp rise in financing costs and the profit pressure associated with the sharp and rapid tightening of monetary policy and the inversion of the treasury bond yield curve. This will continue to reduce their profitability and mean a weakening of their ability to generate capital internally.”

Moody's said that some banks have curbed loan growth, which not only preserves capital, but also slows the shift in loan structures to high-yield assets. However, banks that rely on more concentrated or higher levels of uninsured deposits are more vulnerable to these pressures, particularly those with large amounts of fixed-rate securities and loans.

Additionally, Moody's also downgraded the ratings outlook for Huntington Bank (HBAN.US), CFG-D.US), Regional Finance (RF.US), Ally Financial (ALLY.US), and Bank of the Ozarks (OZK.US), while downgrading the ratings of Bank of New York Mellon (BK.US), United Bank of America (USB.US), State Bank (STT.US), and Truist Financial (TFC.US) Watch list.