In a statement, Moody's said that "the decision to change the outlook on Barclays' standalone rating to negative from stable reflects the rating agency's concerns that the senior resignations at the bank and the consequent uncertainty surrounding the firm's direction are negative for bondholders".
Moody's continued by stating that "Barclays senior debt and standalone ratings could experience further downward pressure if the bank proved to be unable to restore a stable management structure over the coming months; or if there are indications that the current developments were to have a financial impact sufficiently large to put pressure on capital ratios and/or negative implications for the banks' business model".
The agency also stipulated that given the negative outlook, any upward ratings movement is currently unlikely, although the rating could be stabilised if Barclays restores a stable management structure. It also indicated that continued pressure could force the bank to move away from investment banking.
The announcements from Moody's and Standard & Poor's follows an eventful week for Barclays. The former chairman, Marcus Agius; chief executive, Bob Diamond and chief operating officer, Jerry del Missier, all resigned earlier this week, under a cloud of controversy linked to the rate-fixing scandal which has shaken the banking world.
Mr Diamond appeared before the Treasury Committee yesterday to answer a barrage of questions from MPs about the attempts to manipulate LIBOR rates between 2005 and 2008.
When asked when he found out about the rate-rigging, Mr Diamond said it was only brought to his attention last month and as a result made him feel 'physically ill'. He maintained that he 'loved' Barclays and said he was "sad, disappointed and angry".
The chairman of the Treasury Committee, Andrew Tyrie, said some of what the former chief executive had said seemed "implausible", while another committee member, David Ruffley, confirmed that he was not satisfied with Mr Diamond's explanation.
MPs will decide later today as to whether either a full judge or parliamentary-led inquiry into the rate-fixing scandal will go ahead.
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