MOSCOW- Fitch ratings agency has revised banking sector outlooks to negative for Russia and a number other ex-Soviet nations, saying on Wednesday that coronavirus spread and weak oil prices may even trigger negative rating actions.
Oil prices, the cornerstone of Russia's budget revenues, have halved to around $25 per barrel this month after coronavirus hit world demand and a global deal to support prices fell apart in early March.
Fitch said on Wednesday that economic pressure from coronavirus coupled with weak oil prices are "credit negative for banks in Russia and neighbouring markets, and could result in negative rating actions."
Meanwhile, Fitch has revised banking sector outlooks to negative for Russia, Ukraine, Kazakhstan, Armenia, Azerbaijan, Belarus and Georgia, only keeping Uzbekistan's banking sector outlook stable.
Fitch's decision on possible future negative rating actions would depend whether the state or shareholders would be willing to support the banks in withstanding that pressure. For now, Fitch maintains current ratings of 84 banks in the region.
"The stable sector outlook in Uzbekistan reflects the predominance of state-owned companies in loan portfolios and of state-owned lenders in the banking system, and Fitch's expectation of continued government support for these entities," it said.
(Reporting by Dmitry Antonov Writing by Katya Golubkova, Editing by William Maclean) ((firstname.lastname@example.org; +7 495 775 1242;))