S&P; Lowers Ratings for 6 Major Banks’ Securities

NEW YORK — Standard & Poor’s Corp. on Wednesday lowered its ratings slightly on about $13.3 billion in securities of six of the nation’s biggest banking companies, citing concerns over Third World debt and weak financial performances.

At the same time, the major Wall Street credit rating firm affirmed the credit ratings for Citicorp, J. P. Morgan & Co. Inc., Bankers Trust New York Corp. and Bank of Boston Corp. because of what the firm called their increasing financial strength in certain areas.

S&P; slightly lowered debt ratings for Chase Manhattan Corp., the nation’s third-largest bank holding company, and for No. 5 Manufacturers Hanover Corp. of New York, No. 6 Security Pacific Corp. of Los Angeles, No. 7 Chemical New York Corp., No. 12 Mellon Bank Corp. of Pittsburgh and No. 20 Irving Bank Corp. of New York.

The ratings help set the price of credit--interest rates--when the companies borrow money in the credit markets. Securities covered by the ratings change ranged from commercial paper to letters of credit and certificates of deposit.

“The downgrades . . . primarily reflect continued vulnerability to lesser developed countries exposures combined with median financial performance,” S&P; said in a news release.

The rating firm said Chemical’s downgrade also took into consideration the banking company’s recently announced proposal for a $1.2-billion merger with Texas Commerce Bancshares Inc.

The downgrades for Mellon and Security Pacific “reflect higher non-performing assets and weaker operating earnings,” S&P; stated.

Ratings changes were based on the banking companies’ 1986 financial performances, with special attention given to the impact of Third World debt portfolios on profits and capital.

“While Argentina, Brazil, Mexico and Venezuela each face unique economic problems, the lack of progress toward moderating their debt service burdens has been disappointing,” S&P; stated. “Brazil’s unilateral moratorium on debt service payments underscores the potential for polarization between bankers and debtor countries.”

Brazil last month suspended payments on about $70 billion in foreign commercial bank debt, pending restructuring of the debt and lending of new money by the banks.

Citicorp and other U.S. banks with major Brazilian loan portfolios have indicated they might have to classify billions of dollars in loans as non-performing, which would cut into profits.