Exit route: A boat sails across the Victoria Harbour in Hong Kong. — AP
PETALING JAYA: Ratings for Asia-Pacific financial institutions will remain broadly stable in 2023 but risks to ratings are clearly on the downside amid higher inflation and lower growth, according to S&P Global Ratings.
“As of December 2022, 84% of rating outlooks on Asia-Pacific banks were stable, a trend we believe will persist in 2023,” said S&P Global Ratings credit analyst Gavin Gunning said in a report titled “Asia-Pacific Financial Institutions Monitor 1Q23: Banks Will Battle To Stay On Track”.
S&P Global Ratings forecasts credit losses of about US$513bil (RM2.2 trillion) in 2023 for Asia-Pacific banks, about 9% above its estimate for 2022.
It added that challenges could be more acute for non-bank financial institutions, certain emerging market banks, and non-systemically important financial institutions with highly concentrated business and financial profiles.
“Asia-Pacific will be a relative bright spot in the global economy in 2023. Our economic growth forecast of 4.3% for Asia-Pacific for 2023 is much stronger than for the United States and the eurozone.
“For China, we forecast credit losses of about US$436bil (RM1.9 trillion) in 2023, about 8.9% above our estimate for 2022 credit losses,” added S&P Global Ratings
