Credit Ratings: Credit Ratings Of 3 Bank Firms Are Cut by S&P
Standard & Poor's Corp. said it lowered its ratings on the senior debt of Bank of New England Corp., Bank of Boston Corp. and Fleet/Norstar Financial Group because of the worsening New England economy, particularly its real estate sector.</br></br>S&P said it lowered its ratings on $820 million of Bank of Boston's debt. Among the issues affected were the Boston-based company's senior debt, whose rating was lowered to triple-B-minus from triple-B-plus; subordinated debt, downgraded to double-B-plus from triple-B; preferred stock, lowered to double-B from triple-B-minus; and commercial paper, reduced to A-3 from A-2.</br></br>The Bank of Boston issues were removed from CreditWatch, where they were placed April 30 with negative implications, S&P added.</br></br>S&P said Bank of Boston's first-quarter results "evidence the company's slide in asset quality and continued deepening of the New England regional real estate recession." S&P added that the company's loan-loss provisions haven't "kept pace with problem loan identification, and it is likely that lower profitability in future quarters will result."</br></br>Peter J. Manning, Bank of Boston's chief financial officer, said that the company is "obviously disappointed" at the rating change, and that "we stand ready to deal with uncertainties in the current economic environment."