KUALA LUMPUR : Asean banks are equipped with adequate loss-absorption buffers which should support their ratings in the face of external headwinds and a slowdown in growth, Fitch Ratings said. In a commentary on Thursday, the firm said that the operating environment for banks across Asean has become more challenging over the last couple of years. Three out of the six Asean banking sectors – Indonesia, Malaysia, and Thailand – are on negative sector outlooks, reflecting the challenging operating environment and high risks. As a result, Fitch expects non-performing loan (NPL) ratios to rise this year and beyond in Southeast Asia. “The weaker operating environment could potentially expose vulnerabilities created in Asean’s bankimg systems during the years of rapid credit growth that followed the 2008 global financial crisis.

Source: The Star October 06, 2016 23:09 UTC