Bank earnings are showing only minimal effects of lower oil prices, says Fitch Ratings Inc. in a new report.

The New York-based rating agency says the first-quarter earnings results for the five of six big Canadian banks that have reported this quarter reveal a mixed profit performance, with a “de minimus impact” from the decline in oil prices.

“Provisions for credit losses relating to oil exposures were near zero in the quarter,” the Fitch report says. “There was also no significant indication that delinquencies are up-ticking in Canada’s provinces with higher oil exposures, such as Alberta.”

The rating agency suggests that, for the banks, the more significant risk of lower oil prices would come from higher unemployment rates, or increased loan losses in the energy sector.

“Several banks affirmed that they continue to have risk appetite for the energy sector,” the report continues, “although demand for energy-related credit may wane for both reserve-based projects and ancillary, energy services-related businesses. More energy projects are still likely to be delayed or scrapped as businesses retrench and reduce oil-related capital expenditures.”

Further, the Fitch report says, the banks could start making provisions due to oil price declines later in the year if prices remain at or below current levels. That said, Fitch notes that the banks’ direct exposure to loan losses in the energy sector is “manageable,” as less than 10% of total wholesale loans are in the energy sector.

Overall revenue gains, which averaged about 5% year over year, were “fair” in the quarter, Fitch says, adding that those gains were “driven by single-digit increases in net interest income across all five banks.”

The Bank of Canada’s surprise rate cut in January pressured net interest margins, says Fitch: “But [it] may limit near-term asset quality deterioration as the rate cut helps forestall loan-payment stress.”

Fitch also notes that the banks’ wealth-management and capital-markets businesses benefited from stronger equity markets and increased market volatility.

“Foreign-exchange and oil-price volatility may lead to increased hedging by clients,” Fitch says, “which may continue to support higher capital markets activities.”