NEW YORK (AP) - Standard & Poor's Ratings Services lowered its outlook on National City Corp. to negative from stable Friday, citing risk from the shaky housing and mortgage markets.
The agency also maintained the Cleveland-based financial services company's ratings, including its 'A,' or investment grade, long-term counterparty rating.
S&P said National City's profits are being squeezed, and forecast continued declining earnings related to its mortgage exposure. The agency noted that its retail bank, commercial businesses and asset management businesses partly offset the mortgage-related risk.
Last week Moody's Investors Service downgraded the company's investment-grade senior rating to 'A3' from 'A2,' saying the bank will likely face sizable losses in its home equity portfolio. It also cut the company's financial strength rating to 'C+' from 'B-,' and its bank deposits rating to 'A2' from 'A1.' All the ratings remain on review for a possible downgrade.
National City may also be looking for a new owner, according to a recent report.
(This version CORRECTS to remove reference to 'junk territory' in penultimate graph.)
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