SOURCE: Paragon Financial Limited

Paragon Financial Limited

December 01, 2011 08:16 ET

Bank of America and Citigroup Face More Liquidity Concerns

The Paragon Report Provides Equity Research on Bank of America & Citigroup

NEW YORK, NY--(Marketwire - Dec 1, 2011) - Major Banking stocks from across the globe took a hit earlier this week after Standard & Poor's Ratings Services downgraded dozens of large financial institutions citing a new methodology which reflects weaker confidence in governments' ability to bail out banks in trouble. The Paragon Report examines investing opportunities in the Money Center Banking Industry and provides equity research on Bank of America Corporation (NYSE: BAC) and Citigroup, Inc. (NYSE: C). Access to the full company reports can be found at:

Bank of America and its main subsidiaries are among the institutions whose ratings fell at least one notch, along with Citigroup Inc., Goldman Sachs Group Inc., JPMorgan Chase & Co, Morgan Stanley and Wells Fargo & Co. Similar to the way a decline in a person's credit scores drives up the interest rates that banks and credit cards will offer, typically it costs companies more to borrow when their credit ratings are cut. The Wall Street Journal notes that the move did not signal a change of any of the banks' individual credit metrics as much as a revision to the assumptions that had previously bolstered them.

The Paragon Report provides investors with an excellent first step in their due diligence by providing daily trading ideas, and consolidating the public information available on them. For more investment research on the Money Center Banking industry register with us free at and get exclusive access to our numerous stock reports and industry newsletters.

Bank of America said in a recent regulatory filing that downgrades from S&P or Fitch Ratings, which also is reevaluating its ratings, "could likely have a material adverse effect on our liquidity" and cut off its access to credit markets. Bank of America shares hit their lowest point since March 2009 this week, on concerns over another round of stress tests for the financial institution. Keefe, Bruyette & Woods analysts note that Bank of America "had the highest losses to date during the financial crisis."

Also this week, Citigroup's $285 million settlement with the US Securities and Exchange Commission over mortgage-backed securities was rejected by a federal judge who said he hadn't been given enough facts to approve it. Citigroup agreed last month to settle a claim by the SEC that it misled investors in a $1 billion CDO linked to subprime residential mortgage securities.

The Paragon Report has not been compensated by any of the above-mentioned publicly traded companies. Paragon Report is compensated by other third party organizations for advertising services. We act as an independent research portal and are aware that all investment entails inherent risks. Please view the full disclaimer at