trending Market Intelligence /marketintelligence/en/news-insights/trending/pVlc5P1FQp-3sGpdkKEWKg2 content esgSubNav
In This List

Moody's revises outlook on Ireland's banking system to stable from positive

Blog

Banking Essentials Newsletter: 7th February Edition

Case Study

A Bank Outsources Data Gathering to Meet Basel III Regulations

Podcast

Private Markets 360° | Episode 8: Powering the Global Private Markets (with Adam Kansler of S&P Global Market Intelligence)

Blog

Banks’ Response to Rising Rates & Liquidity Concerns


Moody's revises outlook on Ireland's banking system to stable from positive

Moody's revised the outlook on the Irish banking system to stable from positive on the basis that banks' earnings will come under pressure amid a low interest rate environment despite asset risks continuing to decline.

The rating agency said profitability will decline for Irish banks since they rely heavily on net interest income, which makes them vulnerable to low interest rates. Moody's said banks' exposure to low-margin tracker mortgages, higher costs stemming from debt issuances, revenue losses from sales of problem loans and the uncertainty around Brexit may also impact profitability.

Expenses are also expected to remain high for Irish banks because of costs related to IT and digitalization, regulation and pending fees.

Moody's expects the operating environment to remain stable and asset risks to continue to decline, spurred by the sustained disposal or restructuring of problem loans, among other factors.

The rating agency expects capital ratios to remain around their current levels and for robust funding and liquidity to endure.