Prospects for Future Gradings S&P and Moody's differ on prospects for future upgradings, with Moody's being more bullish. However, overall bank ratings at Moody's are lower than those of S&P. The average rating by Moody's for bank holding companies is about Baa2; at Standard & Poor's, most bank holding companies are rated a higher BBB-plus to A-minus. "We anticipate further upgrades of U.S. banks and not many downgrades," Mr. Mahoney said. Banks are being given more time by regulators to work through loan problems, he said, improving the outlook for upgradings. However, Mr. Swanton of Standard & Poor's said credit quality is stabilizing, not showing major improvement. And the number of upgradings remains small compared to the overall number of rated banks, he said. In addition, S&P has a stable ratings outlook on 75% of the bank holding companies it follows. It has a negative outlook on 19%, positive on 6%.