Asked to choose between Moody's and the mutuals, most people would agree building societies have had the better credit crunch. So it is easy to condemn the rating agency's decision to downgrade nine building societies as an attempt to overcompensate for well-documented rating failures earlier in the crisis. Too easy.
Moody's stress-testing of the sector does look extreme. A 40 per cent peak-to-trough collapse in house prices would take the market down well beyond the 18 per cent fall so far registered by Nationwide.
