Fitch Ratings downgraded UBS yesterday and placed seven other US and European banks on credit watch negative, citing challenges in the economy and financial markets, as well as the impact of new regulations.

The ratings agency lowered UBS’s long-term issuer default rating to A from A+.

Fitch is also reviewing ratings for Barclays Bank, BNP Paribas, Credit Suisse , Deutsche Bank, Societe Generale, Bank of America, Morgan Stanley and Goldman Sachs for further possible downgrades.

The cuts would, in most cases, be one notch and in some cases two notches, Fitch said. A lower bond rating can make debt more expensive to issue and lead to higher collateral requirements.

Earlier yesterday, Fitch also lowered its ratings on Royal Bank of ScotlandLloyds Banking Group two notches to A from AA-.