OREANDA-NEWS. The spread of coronavirus and falling oil prices adversely affect banks in Russia and neighboring countries and could lead to lower ratings, Fitch said in a comment.

The rating agency changed the forecast for the banking sector in Russia from “stable” to “negative”. The outlook for Ukraine, Kazakhstan, Belarus, Georgia, Armenia and Azerbaijan is also worsened to “negative”, the agency has maintained stable expectations only for banks in Uzbekistan.

Bank profitability will decline due to a limited number of new loans and higher costs to cover risks, the agency warned. The quality of assets in banks will decline due to a slowdown in the economy and a large number of dollar loans amid falling national currencies, but in Russia to a lesser extent, Fitch said.

The quality of assets in banks will decline due to a slowdown in the economy and a large number of dollar loans amid falling national currencies, but in Russia to a lesser extent, Fitch said.