NEW YORK - Standard & Poor's cut its credit ratings yesterday on 18 banks amid concern about further weakening in the financial sector. But at the same time, 10 of the biggest banks finished repaying $68 billion in government bailout money.

The Treasury Department said last week that the banks could begin repaying money they received last fall under the $700 billion financial-system bailout known as the Troubled Asset Relief Program, or TARP. It was the centerpiece of the government effort to relieve a global credit crunch and teetering financial markets in October.

The ratings cut by S&P included two banks in the Philadelphia area - Wilmington Trust Corp. and Susquehanna Bancshares Inc., of Lititz, Pa. Wells Fargo & Co., which has the largest share of the Philadelphia market through its acquisition of Wachovia Corp. in January, also was cut.

S&P said the changes reflected its assessment that volatility would remain in the financial sector and that the industry was expected to face tighter regulatory oversight. The ratings firm also said loan losses, which have plagued the industry for more than a year, were likely to continue to increase and could grow beyond expectations.

Wells Fargo, BB&T Corp., Capital One Financial Corp., and Regions Financial Corp. were among the largest banks whose ratings were cut by S&P.

"We believe the banking industry is undergoing a structural transformation," S&P credit analyst Rodrigo Quintanilla said. "Such a transition period justifies lower ratings as industry players implement changes."

S&P did note that recent capital-raising efforts in the sector would help defray some of the losses banks were facing.

Lower credit ratings make it more expensive for companies to borrow money and can sometimes lead to difficulty accessing credit.

The banks repaying TARP are some of the industry's largest, including JPMorgan Chase & Co., American Express Co., Goldman Sachs Group Inc., and Morgan Stanley. BB&T and U.S. Bancorp also said they were repaying their TARP money.

With yesterday's repayments, Treasury will have recovered more than $70 billion distributed under the program, including about $2 billion from earlier repayments by smaller banks.