Moody’s upgrades bank outlook to positive from stable

Moody’s ratings agency has changed its outlook on the Cypriot banking system to positive from stable, reflecting its view that the country’s economic recovery will restore banks to profitability and improve their weak asset quality

The outlook expresses Moody’s expectation of how bank creditworthiness will evolve in Cyprus over the next 12-18 months, the agency said.
 
“After five years of losses, we expect banks in Cyprus to be profitable in 2016 and foresee a modest 0.3 per cent – 0.5 per cent return on assets,” said Melina Skouridou, an Assistant Vice President at Moody’s and author of the report. “Cyprus’ accelerating economic recovery, driven by a revival of tourism, the strengthening business services sector and increased consumer spending, will support momentum in banks’ loan restructurings and generate some new business for the banks.”

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