Fitch's Inside Credit: EM Banking Systems Face Challenges and Mitigants

NEW YORK--()--This weeks' edition of Fitch Ratings' Inside Credit newsletter focuses on the challenges facing emerging market banking systems.

Weaker economies, slower growth, seasoning loan books and tighter margins present a difficult operating environment that, when combined with Negative Outlooks on sovereign ratings, have resulted in Negative Outlooks for many banks in Russia, Brazil and South Africa. However, impairment of lenders' financial metrics in these markets has so far been limited or manageable, and Fitch currently expects any negative rating actions to be moderate in scope.

'Sovereign support remains intact for many of the banks in large emerging markets, particularly those with government ownership, underpinning the ratings of systemically important banks and limiting downgrade risks from weaker economies and/or bank metrics,' says James Watson, Managing Director.

Other topics covered in this week's edition of Inside Credit include:

- Restoring Trust in Basel IRB Models Will Take Time

- Bank Sub-Debt and Retail Buyers - Risks Outweigh Benefits

- Lending Slowdown Is Reversing BDCs' Growth

- Valuations Offset U.S. Active Manager Pressures, for Now

- Strong Dollar Remains Headwind for U.S. Multinationals

- Money Funds Withstand Bank Rating Actions

- U.S. Utilities, Power & Gas Companies Show Moderate Growth

- Limited Implications of Asya Case for Turkish Banks

- U.S. Structured Finance Virtual Investor Meetings

- Why Islamic & Ethical Finance Intersect

'Inside Credit' is a weekly snapshot of Fitch Ratings' noteworthy content, selected from all sectors and regions. To receive the weekly edition, distributed every Friday at 8am ET, please sign up here:

http://pages.fitchemail.fitchratings.com/InsideCreditSignUp/

Additional information is available on www.fitchratings.com

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Contacts

Fitch Ratings
Alyssa Castelli, +1-212-908-0540
alyssa.castelli@fitchratings.com
Sandro Scenga, +1-212-908-0278
sandro.scenga@fitchratings.com

Contacts

Fitch Ratings
Alyssa Castelli, +1-212-908-0540
alyssa.castelli@fitchratings.com
Sandro Scenga, +1-212-908-0278
sandro.scenga@fitchratings.com