August 22, 2007 (LPAC) -- A drastic downgrading of the ratings on nearly $100 billion in mortgage-backed securities is currently underway.

Fitch Ratings agency said it is reviewing $92.1 billion "worth" of securities backed by pools of sub-prime mortgage debt. All but $4.2 billion of the securities under scrutiny are rated above BBB, or "investment grade," a rating which is no longer believable.

Standard & Poor's slashed two European mortgage-backed securities funds from AAA to junk, after investors refused to provide short term financing. S&P also cut the rating on $3.2 billion of debt issued by the UK hedge fund manager Solent Capital Partners LLP.

Some funds in the Geneva-based Avendis Group had ratings cut by 17 levels from AAA to CCC. S&P said that the credit ratings may be cut further, Bloomberg financial news reports.