Citing volatility in Bankers Trust New York Corp.'s proprietary trading, Standard & Poor's on Friday placed the money center's debt under review for possible downgrade.

The bank's trading revenues fell to $14 million in the first quarter from more than $340 million in the year earlier period.

"We are not sending a very dire signal on trading," said Tanya Azarchs, analyst with Standard & Poor's.

She said, however, that the ratings agency was uncomfortable with the bank's focus on proprietary trading, given its current very high senior debt rating of AA at the holding company.

Risk Offset

Standard & Poor's remains satisfied that the derivatives dealing and fiduciary and securities processing activities represent an attractive business.

The stable earnings stream from these activities offset the risker aspects of trading operations, the agency said.

It is not anticipated that the ratings will fall below AA-minus/A1-plus at the company's bank subsidiaries and A-plus for the senior obligations of the holding company, Bankers Trust New York Corp. About $5.6 billion of outstanding debt is affected.

"As long as the bank and BT Securities stay at AA it will not be material," said Raphael Soifer, analyst at Brown Brothers Harriman.

The review process is expected to be completed within two weeks.

Commercial Paper

BT Securities Inc.'s A1 commercial paper rating, as well as the A1-plus commercial paper ratings of Bankers Trust Australia Ltd. and Bankers Trust New Zealand, are affirmed and are not placed on CreditWatch.

Separately. Moody's Investors SErvice raised the subordinated debt ratings of Signet Banking Corp. to Baa1 from Baa2.

Moody's also confirmed the A2 ratings on the long-term deposits at Signet's two subsidiary banks.

The actions reflect the Richmond, Va., holding company's improved performance, resulting from a rapidly growing credit-card business, as well as its success in reducing its commercial real estate exposure and nonperforming assets.

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