S&PGlobal Ratings on July 7 revised the outlooks on a number of U.K. lenders dueto the economic risks posed by the vote to leave the EU.

Citing thegrowing risk of adverse economic developments and economic uncertainty after thevote, the agency revised its view of banking-sector economic risk to negativefrom positive, signifying at least a one-in-three chance that the economic-riskassessment may worsen in the next two years. The agency classes the U.K.'seconomic risk as level 4 on a 1-10 scale.

"Webelieve that the U.K. economy is now entering a correction phase," S&Psaid, adding that this and the potentially reduced demand from overseas buyersfor U.K. property will likely affect house prices. It said credit growth will likelybe more subdued, that capital markets revenues will likely fall as corporateactivity such as M&A declines, that pressure on net interest margins couldincrease if the Bank of England further loosens monetary policy and that creditlosses are likely to rise, "albeit from a very low base."

It peggedlikely industry credit losses at above 30 basis points in 2016 and 45 basispoints in 2017, compared to just 14 basis points in 2015, but still lower thanthe long-run average of 69 basis points and well below the 100-plus basis-pointlosses seen during the global financial crisis.

In respectof specific banks, the agency revised to negative from stable the outlooks onthe counterparty credit ratings of Barclays Plc and Barclays Bank Plc, including its core subsidiaries;CYBG Plc and unitClydesdale Bank Plc;HSBC Holdings Plc andcertain rated subsidiaries, including HSBC Bank Plc, HSBC USA Inc., HSBC Bank USA NA and HSBC Finance Corp.; Lloyds Banking Group Plc and units and ; ; andSantander UK Plc.

The agencyrevised to stable from positive the outlooks on the counterparty credit ratingsof Royal Bank of Scotland GroupPlc and Royal Bank ofScotland Plc. It maintained the stable outlook onSantander UK parent Santander UKGroup Holdings Plc, saying the likelihood of support fromBanco Santander SAwould likely offset a decline in Santander UK Plc's intrinsic creditworthiness.

The long-and short-term counterparty credit ratings on Standard Chartered Plc and its rated subsidiaries wereaffirmed, with S&P maintaining the positive outlook on the rated units andthe stable outlook on the parent company, citing Standard Chartered's limitedexposure to the British economy.

Theshort-term counterparty credit rating on Bradford & Bingley Plc was also affirmed.

In separateactions, the agency revised to negative from stable the outlook on Lloyds'U.K.-based insurance subsidiary Scottish Widows Ltd. and affirmed variousratings of PrudentialPlc and its core operating subsidiaries, with a stable outlook onall long-term ratings.

S&P Global Ratings and S&P GlobalMarket Intelligence are owned by S&P Global Inc.