Moody's Investors Service put its ratings of Marshall & Ilsley Corp. on watch for potential downgrade, citing ongoing weakness in the company's real-estate portfolios.

The ratings firm said it may drop the company's senior debt rating, currently three notches above junk territory at Baa1. The rating could fall by up to two notches, Moody's said, though that's less likely than a one-notch downgrade.

Moody's noted the Wisconsin regional bank's weak performance in recent years has been tied to elevated loan-loss provisioning because of real-estate loans. The bank's "capital metrics have fallen behind those of many similarly rated peers, most of which have already returned to profitability," Moody's said.

Standard & Poor's Ratings Service in October cut its rating on Marshall & Ilsley by a notch, dropping it into junk territory, as it said it expected the bank to continue to post near-term losses.

Marshall & Ilsley last month reported its eighth-straight quarterly loss as revenue fell and a drop in its loan-loss reserve wasn't enough to lift it into the black. It has seen its results improve of late, though not as much as some other banks.

Shares recently fell 0.9% to $5.47. The stock has risen just 0.4% this year.

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