The agency downgraded Deutsche Bank, Barclays and Royal Bank of Scotland to "stable" and Commerzbank to "negative".

The move comes shortly after Deutsche Bank, which has been hit by a variety of legal and regulatory issues, announced that its co-chief executives, Anshu Jain and Juergen Fitschen, are stepping down. At Barclays, meanwhile, the bank has agreed to sell its Americas wealth management arm to US-based Stifel Financial Corp. As for Royal Bank of Scotland, the bank, still majority-owned by the UK taxpayer, has been restructuring to try and restore full profitability ahead of any privatisation, which is more likely with the election in May of a Conservative government.

S&P downgraded Barclays by one notch to "A negative" and Deutsche Bank to "BBB positive," three notches above junk territory, the news report said, adding that S&P also affirmed its ratings on Lloyds Bank and HSBC Bank and said the outlooks are stable.