Weakness in capital markets took a toll on Wall Street revenues in the first quarter (Q1), says Moody’s Investors Service in a report published on Monday.

Large U.S. investment banks posted their weakest Q1 results in the last seven years, the New York City-based rating agency reports, and the banks’ fixed income, currencies and commodities (FICC) businesses delivered particularly poor results.

The weakness, “raised questions on the structural and cyclical challenges for their business model,” says Peter Nerby, Moody’s senior vice president, in a statement.

The decision to raise interest rates by 25 basis points at the end of 2015 by the U.S Federal Reserve Board provided slight relief for the banks, Moody’s says, as the median net interest margin rose by six basis points in the quarter.

The banks’ exposure to housing markets continued to decline, Moody’s says, with residential real estate loans down to 24% of total loans. The decrease in mortgage lending has been offset by growth elsewhere in banks’ balance sheets including commercial and consumer lending, specifically auto loans, it adds.

“After years of growth, the auto lending market is going to be more compressed for banks and we’re seeing an uptick in delinquencies despite the strong labor market,” says Jason Grohotolski, Moody’s vice president. “Banks have been underwriting longer loan terms during the last five years and we could see loss severity increase when the market turns.”