It's tempting to ignore Moody's bank downgrades. They were late, heavily broadcast in advance and came from an organization with a lot to prove after missing key elements of the credit crisis.

At Morgan Stanley, which Moody's lowered two notches, the ratings move was characterized as "backward looking." More broadly, the bond market appeared to agree; in the day after the ratings agency announcement, prices of bank debt rose and yields fell.

Focusing on the near-term drop, however, misses the broader point that the ratings changes are part of a far bigger picture. They present a lasting, albeit modest, drag on bank financing. They ratchet up the amount of collateral the affected institutions will have to post on trades and the relative attractiveness of their debt. This makes the ratings cuts part of a narrative in which the perks that for decades made being a banker at a giant institution a wonderful life are inexorably disappearing.

It is increasingly difficult for banks to leverage a perception of stability into cheap funding for capital markets activities. Extra capital buffers that are being required of the largest institutions play a similar role. And regardless of whether you view the Volcker rule as necessary or effective, it will make it more difficult for banks to fund proprietary trading with deposits.

In consumer banking, that big guys have historically leveraged outsized marketing budgets and prime locations to reel in huge numbers of customers by offering "free" checking - and then earn their keep with back-end charges like overdraft and interchange fees. After Regulation E overdraft opt-ins and the Durbin amendment to Dodd Frank, that commoditized retail model is looking strained.

JPMorgan Chase's Jamie Dimon has quipped that such policies amount to "discrimination" against big banks intended to neutralize their natural size advantage. Detractors can put together an opposing case that those traditional strengths were themselves market distortions.

If the major banks are left providing financial supermarkets in which most products are indistinguishable from those of rivals, innovations will quickly be copied services and returns only marginally exceed the cost of capital. Industry growth in such a world will essentially be limited to the pace of the broader economy.

Looked at this way, the operating costs that Moody's downgrades have added are less a form of discrimination than a reversion to the mean. The same is true of the many other bits of regulatory tightening seen lately. In such a world, big banks can still act globally and contribute to the world economy. But stripped of artificial advantages, they wouldn't grow faster or generate higher margins than anyone else.

At the moment, there's no sign of an easing of the pressures that are stripping big banks of their exceptionalism. Morgan Stanley's avoidance of a three notch downgrade received the most attention, but JPMorgan's two notch hit, from Aa1 to Aa3, is likely the most significant sign of pressure.

In explaining that move, Moody's prefaced its comments with praise for the bank's leadership and capital position. Then it got down to the brass tacks: the losses in the bank's London Chief Investment Office suggest that the unwieldiness of managing the bank mitigates the advantages of diversification. Bottom line: the ratings agency is uncomfortable with the risks inherent in operating the bank's massive capital markets business.

"Any further control failures, a marked increase in risk appetite or a willingness to increase leverage could lead to downward pressure on the ratings," the firm wrote. "Upward pressure on the rating is unlikely."

In other words, there's room for big banks like JPMorgan to mess up - but not to regain the enviable status they held previously. As difficult as the last few years have been for major banks, they're looking at a lot more downside than upside.