Morgan Stanley To Lose Billion If Downgraded

Moody's has been threatening for some time now to downgrade banks in the US on their credit ratings. Today Morgan Stanley (NYSE:MS) revealed that if its credit rating was downgraded it would face huge costs. The company stated that a decisive move by the ratings agency would obligate the financial institution to $7.2 billion i collateral to counterparties. That figure is based on a downgrade of 3 places on the company's credit.

Other banks that have been threatened by the ratings agency include Bank of America Corp (NYSE:BAC) and Citigroup Inc. (NYSE:C). Bank of America has estimated that...