For Asia-Pacific’s top 60 banks, the view from the peak of the credit cycle is uplifting, according to “Top 60 Asia-Pacific Banks: Nice Views From The Peak Before The Credit Cycle Turns” – an article published on Monday by S&P Global Ratings.
The banks’ operating performance was remarkably stable during the first half of the year, the company said.
S&P Global Ratings only took a small number of rating actions during the period, these generally impacting rating outlooks and driven mainly by sovereign-support factors – and not bank-specific rating factors.
Moreover, the net negative rating outlook bias across the Asia-Pacific portfolio of over 300 rated financial institutions was minus 4 per cent as of June 30, its lowest level in recent years.
“The small number of actions in the first half of fiscal 2018 affecting Asia-Pacific’s top 60 banks, and the stabilising net rating outlook bias, generally reflects our view that – with some noteworthy exceptions – the credit cycle is at its peak as it impacts the Asia-Pacific region’s financial institutions sector,” said Gavin Gunning, a credit analyst at S&P Global Ratings.