ANZ today confirmed Moody’s decision to revise Australia’s macro profile has resulted in a change in the outlook for the major Australian banks, including ANZ, from stable to negative.
Moody’s reaffirmed ANZ’s Aa2 rating moving from Aa2 (Outlook Stable) to Aa2 (Outlook Negative) saying it expected a more challenging operating environment for the banks for the remainder of 2016 and beyond.
The ratings outlook change has not impacted Moody’s rating of ANZ’s baseline credit or counterparty risk assessment.
Moody said that bank profits are likely to be squeezed thanks to low interest and strong competition between lenders, as well as moderately rising credit costs. That said they comment on the strong profitability in the sector, and higher capital ratios.
“While Moody’s expects further capital improvements over time, the timing of such improvements will depend on the global and domestic regulatory agenda.”
