09:21 AM EDT, 03/27/2024 (MT Newswires) -- S&P Global's ( SPGI ) S&P Global Ratings said Tuesday it has revised its rating outlook for First Commonwealth Financial ( FCF ) , M&T Bank ( MTB ) , Synovus Financial ( SNV ) , Trustmark (TRMK) and Valley National Bancorp ( VLY ) to negative from stable, citing their sizable exposure to commercial real estate.

Stress in CRE markets such as reduced property prices may "hurt the asset quality and performance of the five banks, which have some of the highest exposures to CRE loans among banks we rate," S&P said.

However, S&P said most of the banks have good underwriting track records, often granular loan exposures and limited loan exposure to the "most troubled" metro office markets.

"If the Federal Reserve pivots to lowering interest rates -- which could happen as early as midyear -- we believe that could also help alleviate some of the cumulative stress in the CRE sector," S&P said.

Meanwhile, S&P reaffirmed its current ratings for those five banks to reflect "some mitigating factors, including solid underwriting track records and limited deterioration in asset quality."