Wall Street Brief: Moody’s Reviews Top Banks, Google-Motorola Deal Under Review
Moody’s (NYSE:MCO) has warned it may cut the credit ratings of 17 global banks and 114 European financial institutions in response to the spread of the euro zone’s debt crisis. In a statement by the agency, it said of the cuts, “Capital markets firms are confronting evolving challenges, such as more fragile funding conditions, wider credit spreads, increased regulatory burdens and more difficult operating conditions.” U.S. banks currently being reviewed include Bank of America(NYSE:BAC), Citigroup (NYSE:C), Goldman Sachs (NYSE:GS), JPMorgan Chase(NYSE:JPM), Morgan Stanley (NYSE:MS) and Royal Bank of Canada (NYSE:RY).
Greece believes it has met European Union and IMF demands for a rescue plan to avoid a March default and hopes it will be approved on Monday. Euro zone officials have said not so fast and are reviewing options to either delay some or all of the plan until after elections. Meanwhile, the Troika may stage a permanent presence in Greece and create an escrow account for funds, ensuring payment of Greece’s debt.
China’s Anti-Monopoly Bureau is conducting a routine review for Google’s (NASDAQ:GOOG) $12.5 billion acquisition of Motorola (NYSE:MMI). China is expected to approve the transaction but it has a March 20 deadline for either a decision or to add an additional phase of the process. Under Chinese law, according to Reuters, enterprises running businesses in China that earn global annual revenues of 10 billion yuan ($1.55 billion) and 400 million yuan in China have to gain government approval for proposed acquisitions.
On Wednesday, CBS (NYSE:CBS) reported its fourth quarter earnings and saw higher fees from pay-TV systems and affiliate stations. This helped increase its net profit by 31 percent to $370 million but revenues dropped 3 percent to $3.78 billion, missing analyst estimates. CBS’s sales numbers dropped from advertising income declines but CBS CEO Leslie Moonves gave a positive forecast and said the network is talking with Netflix (NASDAQ:NFLX) to produce a show for them.
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