Bangkok--19 Mar--Moody's
Moody's Investors Service says that the fundamental credit outlook for the Philippine banking system is negative, reflecting expectations that a slowing economy will contribute to a cyclical weakening in the country's bank credit fundamentals.
"Moody's industry outlook for Philippine banks is negative based on our expectation that challenges in their operating environment will depress bank earnings and pressure their asset quality," says Richard Lung, a Moody's Vice President/Senior Analyst.
"However, our outlook for the intrinsic stand-alone financial strength ratings of individual banks remains stable, as we believe that they can absorb these pressures without experiencing a prolonged deterioration in their relative credit metrics," adds Lung.
Lung was speaking on the release of Moody's latest Banking System Outlook for the Philippines. The report, which was authored by Lung, expresses Moody's expectations for credit conditions in the banking system over the next 12 to 18 months.
The extensive report -- published annually by Moody's -- looks at a wide variety of topics, including positive and negative rating trends, the impact of the global credit crunch and slowdown in Philippine economic growth, and key system performance measures, including financial fundamentals.
Moody's Banking System Outlook: Philippines can be found at www.moodys.com.
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