FSA 'satisfied' with HBOS

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The FSA has moved to reassure HBOS investors on the financial resilience of the UK's largest mortgage and savings organisation.

HBOS shares plummeted 22% yesterday after an 18% decline on Monday, as fears mounted the bank could be the next credit crunch casualty. However, the regulator says HBOS is a “well-capitalised bank that continues to fund its business in a satisfactory way”. Ratings agency S&P yesterday cut HBOS’ long-term counterparty credit ratings from AA- to A+, the fourth-highest investment grade. Analyst Nigel Greenwood says HBOS was “less well positioned” to manage the deteriorating operating environment than AA- rated peers. Fitch cut the company's long-term issuer default ratings to AA from AA+...

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