Story updated to include the proper stock symbol for Lazard.

NEW YORK ( TheStreet) -- Bank of America ( BAC - Get Report) analyst Guy Moszkowski downgraded Citigroup ( C - Get Report) and Goldman Sachs ( GS - Get Report) to "neutral" from a buy recommendation due to expected weakness in first quarter results.

"Results are unlikely to be dismal, and should show improvement over Q4, but we don't expect seasonal improvement as strong and as often seen in the past," Moszkowski said in the note. "Client engagement remains subdued, Mid-East turmoil likely only to further reduce customer risk appetite."

Moszkowski added that as investors turn away from BofA, they will focus on financials that are less "or even positively" affected by the adoption of the Volcker Rule, including non-banks such The Blackstone Group ( BX - Get Report), KKR ( KKR - Get Report) and Lazard ( LAZ - Get Report).

The Volcker Rule, part of the Dodd-Frank Wall Street Reform and Consumer Protection Act that was signed into law back in July, generally restricts banks from engaging in proprietary trading or owning private equity or hedge funds.

"This, together with low valuation relative to current earnings, drives keeping JPMorgan Chase ( GS - Get Report) a 'Buy'" the note added.

Citigroup's stock was down 9 cents at $4.57 in morning trading while Goldman Sachs stock was down $2.93 to $161.56.

--Written by Maria Woehr in New York.

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