NEW YORK (

TheStreet

) -- Standard & Poor's will be taking a close look at banks' recently announced share buyback programs to be sure they do not weaken the companies' balance sheets.

JPMorgan Chase

(JPM) - Get Report

,

PNC Financial

(PNC) - Get Report

,

Wells Fargo

(WFC) - Get Report

,

U.S. Bancorp

(USB) - Get Report

,

Bank of New York Mellon

(BK) - Get Report

and

State Street Corp

(STT) - Get Report

have all announced dividend hikes and share buybacks in the past week, while

BB&T

(BBT) - Get Report

and

Citigroup

(C) - Get Report

announced modest dividend increases. The moves will take effect in the first quarter for some banks and the second quarter for others.

On Thursday, S&P published a report urging banks to "proceed with caution," and noting "we consider capital adequacy to be a neutral to negative ratings factor for most U.S. banks."

S&P credit analyst Stuart Plesser, author of the report, told

TheStreet

he and his colleagues will be looking for further details from the banks on what their plans are.

"Some of them have asked for some nice-sized buyback programs, but that doesn't mean just because they have them they're going to use them," he says. "What events have to happen for them to be comfortable to use them? Is it earnings growth? Is it stock price? These are things we'll be looking at as they report first quarter earnings," Plesser said.

Moody's Investors Service also expressed reservations about the banks' announcements.

"Although not unexpected, banks' increased willingness to increase their capital outflow to shareholders is credit negative because it comes at a time when the economic recovery is still fragile, and US banks' credit quality remains vulnerable to another economic downturn," stated a Moody's report published this week.

However, Moody's stated that "a compensating feature" in the announced shareholder goodies is that "the aggressive initiative" comes via buybacks rather than dividend hikes.

"History has shown that banks are quick to halt stock buybacks, but slow to cut dividends when they report losses. It is for this reason that we prefer a bank's return of capital to shareholders to be skewed toward stock buybacks rather than dividend payments, which we consider more sticky," Moody's analysts wrote.

Carole Berger, analyst at Luna Analytics, expressed surprise at the ratings agencies concerns, but didn't expect them to have a major impact.

"It hasn't been on my radar screen," she said. "It would surprise me if there were ratings downgrades at this juncture with credit getting better and capital continuing to build."

Arturo Cifuentes, a former Moody's analyst who is now a professor at the University of Chile, argues Moody's and S&P's shoddy ratings practices helped inflate the housing bubble and they are now trying to redeem themselves by showing they have raised standards.

"It's a PR campaign, of course, and it's not working," Cifuentes says.

The banks that have announced the buyback programs either declined comment or did not respond to questions.

--

Written by Dan Freed in New York

.

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.