Global banks downgrades almost halved to 57 in the first quarter from their high in the four quarter of 2011 at 103, according to Fitch Ratings' quarterly trends report. However, the report indicates upgrades in the first quarter "were minimal" at only eight.
The report also highlights that negative rating actions were centralised in Europe, which made up 77% of all first quarter negative rating actions.
Developed European countries took the "lion's share", reflecting negative actions taken on seven eurozone countries: Belgium, Cyprus, Ireland, Italy, Slovenia, Spain and Greece. This resulted in negative actions being taken on bank ratings in these regions, says Fitch.
Hungary was also downgraded, triggering the downgrade of two Hungarian bank ratings.
Were global bank rating outlooks and rating watches combined, these would show a marginally more negative picture in the first quarter, with 18.8% of global bank ratings on negative outlook/rating watch negative and 3.8% on positive outlook/rating watch positive.
"The broad outlook picture, nevertheless, remains unchanged," says Janine Dow, senior director in Fitch's financial institutions team. "Over 75% of ratings assigned by Fitch to banks globally are on stable outlook."
This has held true over the past four quarters, she notes.
However, Dow stresses "the rating stock has shifted downwards and the average rating is lower than it was a year ago."
Emerging markets bank ratings are showing greater stability, with only a small number shifting from "A" and "BB", says Fitch.
Bank ratings in developed markets are "trending down slightly", with 46.9% in the "A" range at the end of the first quarter and 26.9% at "BBB".