UPDATE: Goldman Sachs Downgrades Royal Bank of Scotland Group to Sell

In a report published Monday, Goldman Sachs downgraded its rating on Royal Bank of Scotland Group

from Neutral to Sell. Goldman Sachs noted, “Of the UK banks in our coverage, we view RBS as most exposed to near-term regulatory risk. We downgrade the stock to Sell (from Neutral). We remain Neutral rated on Lloyds Banking Group but highlight near-term regulatory risks to the shares. Barclays could also be impacted, but we expect the group to announce balance sheet shrinkage as part of its strategic review (February 12, 2013) supporting capital ratios. HSBC/Standard Chartered are unlikely to be identified as having capital shortfalls in our view; we retain a preference for HSBC on the basis of relative valuation, return trends and expectations.” Royal Bank of Scotland Group closed on Friday at $11.68.