Downgrade doom: Moody’s service steamrolls 15 large banks

Wall Street’s day of reckoning is upon it.

The credit rating of Swiss banking giant Credit Suisse was cut three notches and 14 other banks’ ratings were lowered as part of a review of the financial sector.

The downgrades by Moody’s Investors Service, in the works for several months, may force banks, including Citigroup, Bank of America and Morgan Stanley, to pay more to borrow money and could cut into profits.

“All of the banks affected by today’s actions have significant exposure to the volatility and risk of outsized losses inherent to capital markets activities,” said Moody’s Managing Director Greg Bauer in a statement accompanying the agency’s 25-page report.

Morgan Stanley, which had been one of the financial firms expected to be hit with a three-notch downgrade — the largest Moody’s said it would undertake — suffered just a two-level cut of its unsecured debt rating, to Baa1 from A2.

Morgan Stanley CEO James Gorman had petitioned doggedly to get the ratings firm to give it extra credit for moves it had made to bolster its liquidity and stabilize its business — including its relationship with large Japanese bank Mitsubishi UFJ, which owns a 22 percent stake in the bank.

That said, Morgan Stanley still bristled at Moody’s action.

“We believe the ratings still do not fully reflect the key strategic actions we have taken in recent years,” a Morgan Stanley spokeswoman said.

BofA’s long-term debt rating dropped one peg, from Baa1 to Baa2, while, Barclays Capital, Citigroup and JPMorgan Chase saw two-notch downgrades.

Banks were largely irked at the moves and blasted the agency.

“Moody’s approach [to ratings] is backward-looking and fails to recognize Citi’s transformation over the past several years,” the bank said.

Still, most believe that the moves made yesterday by the firm won’t necessarily have a significant impact on the industry since the cuts have been under review for months.

“These cuts have been baked into the market for months,” said Nancy Bush, financial analyst at SNL Financial.

For Credit Suisse, run by American-born Brady Dougan, the three-notch downgrade of its senior debt, to A1 from Aa1, was a big blow to the bank chief.

The Swiss central bank recently spotlighted Credit Suisse as an institution that needs to raise capital faster amid European fiscal concerns.

Banking stocks, battered over the past several weeks, rose in after-hours trading.

Morgan Stanley shares gained 3.4 percent, while BofA, JPMorgan and Citi each gained about 1 percent.

mark.decambre@nypost.com

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Capital One card is No. 1 — in complaints

Maybe it shouldn’t be in your wallet.

Capital One, the lender known for its aggressive attempts to woo new credit-card customers with its “What’s in your wallet?” ad campaign that features Vikings and like-minded actor Alec Baldwin, accounts for 20 percent of card complaints, according to a study by the new federal consumer watchdog.

For now, the US Consumer Financial Protection Bureau data only goes back to June 1. But via a public records request, Reuters obtained a fuller data set: all credit card-related complaints filed between the CFPB’s opening on July 21, 2011 and May 15 of this year.

The data show that of the 13,502 complaints filed in that period, 2,713 were lodged against Capital One, which has less than 6 percent of the US credit-card market by purchase volume.

That was about 300 more than the next-closest complaint subject, Citigroup, which has a market share of about 9.5 percent. US Bank had the lowest number of complaints among top-10 issuers: just 2.1 percent of the total.

In the most recent period, after June 1, Capital One’s numbers actually ticked up slightly — it accounted for 22 percent of all issues raised in the period.

“Our goal is to exceed customer expectations,” a Capital One spokeswoman said.

Copyright 2010 Thomson Reuters. Click For Restrictions

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Hondo: Phil fills the bill

Semi-sizzling Hondo posted another gain in light betting last night as his bullishness on the Tigers was rewarded with a victory that slashed the deficit to 1,270 crosettis.

Today, wrapping things up early with a Stadium matinee, Mr. Aitch will hop on Hughes & Co. to humble Hanson – 10 units.

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John Kerry reportedly will play the role of Mitt Romney in Obama’s mock debates. That seems like a terrible case of miscasting – Kerry’s mopey horse face is way too long and morose for the role . . . Roger Clemens owes absent-minded Andy Pettitte a huge debt of gratitude for forgetting at trial what Clemens said he misremembered in the first place . . . Memo to Angry Alec Baldwin (from photographers everywhere): FOR THE LOVE OF GOD, MAN, MEDICATE NOW!!!

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Spotify with free i-apps

Music-subscription service Spotify is rolling out a free mobile radio service for Apple’s iPad and iPhone.

Spotify, backed by the major music labels and entrepreneur Sean Parker, had charged $10 for mobile access to its app. The hope is that the free service, supported by ads, will entice consumers to upgrade to the premium paid tier.

Spotify, which offers a $5-a-month version stripped of ads, has signed up 3 million paying users since its December launch in the US.

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Former Jets RB Tomlinson to retire today

Running back LaDainian Tomlinson, who spent the past two seasons with the Jets, will retire today.

The Chargers announced yesterday they would re-sign Tomlinson, who spent nine years with the team, today and he would then announce his retirement.

Tomlinson is the fifth-leading rusher in NFL history and was the MVP in 2006. He finished with 13,684 yards and 145 touchdowns.

The Chargers and Tomlinson had a acrimonious split in 2010 and he signed as a free agent with the Jets. Tomlinson, who turns 33 this week, ran for 914 yards in his first season with the Jets and helped them get to the AFC Championship. His production dipped last season as his role decreased. He carried the ball 75 times for 280 yards and dealt with knee problems.

After the season, Tomlinson said he would like to keep playing if the right situation presented itself.

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Americans on a major roll after Simpson's U.S. Open win

SAN FRANCISCO -- In a little more than six months, they shared the stage in a playoff, became fast friends through their faith and then partners in the Presidents Cup.

Webb Simpson and Bubba Watson are linked again in ways they never imagined.

Major champions.

Simpson joined the most important fraternity in golf Sunday at The Olympic Club with a flourish of birdies and a steady diet of pars at the end. The last one came from a delicate chip out of a hole in the rough to 3 feet that wound up being the decisive stroke in the U.S. Open.

On a leaderboard loaded with possibilities, his name did not stand out. Simpson was playing in only his fifth major, and his second U.S. Open. He had missed the cut in his last two tournaments. And he was six shots out of the lead when he walked off the fifth green with his second bogey of the day.

Some four hours later, Simpson sat in the clubhouse with his pregnant wife, Dowd. They tried to take their mind off the finish by watching videos of their young son, James, who stayed behind in North Carolina. She squeezed tight on his hand as they watched Jim Furyk hit into the bunker on the 18th to eliminate his chances, and then Graeme McDowell miss a 25-foot birdie putt that would have forced a playoff.

"If I was honest with you, I believed in myself (that)I could win a major, but maybe not so soon," Simpson said. "And I just gained all the respect for the guys who have won multiple majors because it's so hard to do. The level of pressure is so much greater than a regular event."

"I probably prayed more the last three holes than I ever did in my life," said Simpson, a religion major at Wake Forest.

It was Simpson who called over to Watson, their caddies and their wives to huddle under an umbrella on the green at Royal Melbourne for a quick prayer after they won a match that set the tone in the Presidents Cup.

They are nothing alike. Watson manufactured a swing on a public course in the Florida Panhandle and doesn't have a formal teacher. Simpson grew up at a country club and even played Augusta National when he was a teenager. Watson speaks his mind. Simpson is more reserved.

Watson and Simpson traded text messages the morning of the final round last year in New Orleans. Watson wound up beating him in a playoff, but the relationship took root. When it became clear they would qualify for the Presidents Cup, they asked U.S. captain Fred Couples if they could be partners. They won three of their matches.

Couples was wandering around Olympic and watched it unfold.

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Hughes lifts Yankees to 7th straight win

WASHINGTON — This city has plenty of lawyers, guns and money. History, museums and narcissistic politicians are abundant, too.

What the nation’s capital didn’t have last night was an answer for the blistering Yankees.

The hottest team in the NL was no match for the best of the AL at a sold-out Nationals Park where the Yankees hung a 7-2 loss on the hosts in front of a crowd that included many Yankees fans in the 41,406.

The Yankees’ season-high seventh straight victory is the longest active streak in the majors and hiked their record to 39-23.

Coupled with the Orioles losing to the Braves, the Yankees’ win increased the AL East lead to 1 1/2 games.

Reuters

PHIL UP THE TANK: Phil Hughes, who allowed one run on six hits over six Innings while striking out nine, delivers a pitch during the third innings of the third inning of the Yankees' 7-2 victory over the Nationals lst night. Hughes won his fourth straight decision and has not lost since May 17.

The Yankees have won 12 of their last 14 games and are 8-2 in interleague play.

The hot stretch has been fueled by strong starting pitching. In the 14 games the starters are 11-1 with a 2.40 ERA.

Phil Hughes improved to 7-5 with his fourth straight victory. Hughes hasn’t lost since May 17 at Toronto.

YANKEES BOX SCORE

“You don’t want to be the one who lets it down,’’ said Hughes, who went six innings, gave up one run and two walks. He fanned a season-high nine and it was the first time in 13 games he didn’t surrender a home run.

Gio Gonzalez started the game for the Nationals with an 8-2 record and a 2.35 ERA. Nevertheless, it was more of the same for the lefty against the Yankees.

In six innings, Gonzalez allowed three runs and five hits. The former A’s hurler has dropped his last five decisions to the Yankees and is 1-5 with a 6.75 ERA.

Curtis Granderson homered and doubled in two runs. It was Granderson’s 20th homer of the season.

David Robertson worked the final frame. It was his first outing since injuring a left rib cage muscle May 11.

For the first six weeks of the season manager Joe Girardi’s starters weren’t awful but very inconsistent. Lately, they look like five Cy Young candidates.

“I think they were better than the way they were pitching,’’ said Girardi, who bagged his 500th win as a manager (421 with the Yankees). “They seem to be pitching the way they are capable of.’’

Staked to a 2-0 lead in the third when Alex Rodriguez, who tied Jimmie Foxx for sixth place on the all-time RBI list at 1,924, and Nick Swisher delivered RBI singles, Hughes faced his biggest challenge in the home half of the frame.

Consecutive singles by Steve Lombardozzi and 19-year-old stud Bryce Harper which went off Hughes’ foot, were followed by a fly ball out and a walk to Adam LaRoche that loaded the bases.

“I made a horrible pitch and hung a curveball,’’ Hughes said of the 0-2 pitch Michael Morse laced to center or an RBI single.

Hughes rebounded to induce Ian Desmond to bang into a 6-4-3 double play and kill the rally.

Four runs in the seventh put the game away for the Yankees who were helped by Desmond’s throwing error. Granderson supplied a two-run double to left field and Derek Jeter (2-for-5) drove in a run with an infield single that Desmond committed a throwing error on and allowed a second run to score. Granderson added his 20th homer in the ninth.

As for Hughes turning around a 1-5 start, Girardi has noticed a big difference.

“The last seven or eight starts he has been tremendous, good command of the fastball and expanding [strike zone] with breaking ball and that has been the key,’’ Girardi said. “This is as good as we have seen him.’’

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