Moody’s Investors Service cut the ratings of three American banks late Wednesday, saying it was now less likely the government would bail them out if they were found to be in financial difficulty.

Bank of America, Wells Fargo and Citigroup all saw their credit ratings lowered by varying degrees, and analysts reacted with disapproval. Advisors may not be too happy, either, if they are tied to one of the three.

Bloomberg reported that the ratings agency lowered the senior debt rating of Bank of America, the biggest lender in the U.S. by assets, two levels to Baa1 from A2. Long-term senior ratings were kept at negative, indicating that Moody’s may contemplate another cut. Short-term debt for the bank was cut from Prime 1 to Prime 2.

Wells Fargo’s senior debt went down a notch from A1 to A2, with its senior long-term ratings kept at negative.

Citigroup’s short-term ratings went from Prime 1 to Prime 2, but the agency confirmed its long-term rating of A3 and Citibank NA’s A1 long-term and Prime 1 short-term ratings. In a statement, Moody’s said that it was “more likely now than during the financial crisis” that the government would allow a big bank to fail.

patrick burnsAttorney Patrick J. Burns (left), who leads his own firm and specializes in helping advisors who are going independent, said in an e-mail statement that the ratings cut might be another push for wirehouse advisors who are considering heading out on their own, coming as it does on top of news last week that UBS lost some $2.3 billion to a rogue trader.

“Many UBS brokers still remember the firm’s 2009 issues,” Burns said, adding, “[O]ur law firm believes [the events of the past week] may increase the number of wirehouse brokers looking to go independent … Bank of America, Wells Fargo and Citigroup were all TARP recipients in or about 2008, so the Moody’s downgrades today are sure to concern their brokers.”

The move by Moody’s could be seen as a success for the 2010 Dodd-Frank Act, which was, among other things, designed to end government bailouts of big banks. Rep. Barney Frank, D-Mass., ranking member of the House Financial Services Committee, said in a statement, “I can’t comment on the absolute value of Moody’s ratings, but I am pleased that the rating agency recognizes that such large institutions are not ‘too big to fail.’ ”

Frank may have been pleased with the action, but analysts were not. Jason Brady, a managing director at Santa Fe, N.M.-based Thornburg Investment Management Inc., was quoted saying, “We have not gotten beyond too-big-to-fail. We had an experiment where we let one [Lehman Brothers] go and it didn’t work out so hot. Now they are going to be more likely to let somebody go? I don’t think so.”

Markets did not seem happy with the move either. The cost for Bank of America to insure its debt for five years in the credit default swap market rose 48 basis points, and the stock for all three banks dropped, with Bank of America down 7.5% at close, Citigroup down by about 5.2%, and Wells Fargo lower by 3.89%.