Moody’s worsens outlook on Russian banking system over virus

MOSCOW, Apr 8 (PRIME) -- International rating agency Moody’s has worsened its outlook on Russia’s banking sector to negative from stable due to the spread of coronavirus and a slump in oil prices, the agency said in a report on Wednesday.

The outlook is changed for the next 12 to 18 months and the move reflects the agency’s view that the coronavirus outbreak and the recent slump in oil prices will undermine the economic activity and hurt the quality of assets and the banks’ profitability, the agency said.

According to Moody’s, the operating environment for banks in Russia will worsen as economic growth will almost stop.

Russia’s gross domestic product (GDP) is unlikely to grow in 2020 due to low oil prices and closure of businesses aimed at limiting social contacts to contain the spread of the coronavirus epidemic, the agency also said.

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