The global trend in bank credit ratings was negative once again in the second half of 2016, Fitch Ratings reports.
Bank credit downgrades outnumbered upgrades for in the second half of 2016 for the fifth consecutive period, according to the credit-rating agency. Specifically, there were 28 downgrades and 25 upgrades in emerging markets and there were six downgrades and three upgrades in developed markets during the period.
At the same time, Fitch reports that the global distribution of rating outlooks was broadly unchanged. Almost three-quarters of banks have stable outlooks, it notes, with the rest skewed toward negative outlooks.
In emerging markets, 30% of banks had a negative outlook at the end of 2016, Fitch says. Negative outlooks on sovereign ratings in Turkey, Saudi Arabia and Latin America are largely driving this trend, the firm adds.
Similarly, in the developed markets, banks in Japan and Italy are under a negative outlook, which reflects the sovereign outlook in those countries.