A set of possible multi-notch downgrades may not drive banks into a capital spiral, even if they were met by similar moves at ratings agencies Standard & Poor's and Fitch, which could cost roughly a combined $20 billion for JPMorgan, Bank of America ( BAC), Morgan Stanley ( MS), Citigroup ( C ) and Goldman Sachs ( GS), as the banks have disclosed. "What we've seen with the largest banks, and U.S. banks in particular, is that their liquidity profile has improved after the crisis," said Joo-Yung Lee, the head of Fitch Ratings' North American financial institutions team, of the prospective ratings cuts, in a March 27 interview . "In blunt terms, in our view, Moody's just doesn't think it is as good an industry as they did in the past," wrote Schorr of Nomura in March, who says the industry average rating could fall to "Baa." Four years ago, few on Wall Street would have said banks couldn't survive such ratings. Now, with transformed balance sheets and new funding sources, known as liquidity, ratings cuts may be a headwind for profitability but not a deathblow. "Capital markets firms are confronting evolving challenges, such as more fragile funding conditions, wider credit spreads, increased regulatory burdens and more difficult operating conditions," said Moody's in February when announcing its ratings review. Currently, Standard & Poor's and Fitch have yet to cut U.S. bank ratings, since a series of downgrades in the second half of 2012. If all cuts under review by Moody's were made and matched Standard & Poor's and Fitch, they currently hold higher ratings and a more positive outlook on average JPMorgan's "fortress balance" sheet would be an industry leader at A2, a not so prestigious rating. For more on bank stocks, see Bank of America was a ratings cut loser and what Warren Buffett knows about bank investing that you don't. -- Written by Antoine Gara in New York.