Czech banks underpinned by strong growth, favourable environment - Moody's |
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Tue, 21 Aug 2007 17:48
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MUMBAI (Thomson Financial) - Moody's Investors Service said the overall outlook for rated Czech banks remains stable as they continue to benefit from parental, systemic support expectations, as well as sound risk profiles underpinned by retail strategies, improved risk management and moderate risk appetite.Moody's in its new 'Banking System Outlook' report for the Czech Republic said the Czech banking sector is also underpinned by strong economic growth and mounting appetite for consumption and borrowings.Moody's expects SME and retail loan growth will, in particular, remain strong in the medium term, especially if the economy stays in good shape.In the agency's view the overall risk profile of the Czech banks is good, with improved credit risk management, however the banks still have a relatively conservative approach towards lending and non-performing loans.The Czech Export Bank benefits from 100 pct state ownership, thus underpinning their deposit ratings, while Ceskoslovenska Obchodni Banka, Ceska Sporitelna, Komercni Banka and Zivnostenska Banka would receive financial support from their foreign strategic shareholders as well as support from the Czech authorities in the case of need.However, despite the rapid growth in lending, Czech consumers and companies still boast relatively low indebtedness levels compared with developed Europe, the agency added.tfn.newsdesk@thomson.compvi/jlcCOPYRIGHTCopyright AFX News Limited 2007. All rights reserved.The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.
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