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Moody's lowers Wells Fargo
Moody's Investors Service said it lowered the senior debt rating of Wells Fargo & Co. to A1 from Aa3, the senior subordinated debt rating to A2 from A1 and the junior subordinated debt rating to A3 from A1. The preferred stock rating was downgraded to B2 from A2. Wells Fargo's short-term rating was affirmed at Prime-1.
The outlook is stable. The actions conclude a review for downgrade that began on March 4.
"The moderate downgrades of Wells Fargo's deposits, senior debt and senior subordinated debt ratings are based on Moody's expectation of very high systemic support for these instruments, and the view that such support will enable the substantial value of its franchise to materialize in the medium to long-term," Moody's senior vice president Sean Jones said in a statement.
"Such support, however, could be potentially harmful to preferred stock investors."
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