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Bank Industry Risk Analysis: U.K. Banks Stand Firm Against Changing Credit Environment Dec 06
Standard & Poors, Dec 2006
Abstract
Standard & Poor's Ratings Services considers the U.K. banking system to be one of the strongest in the world. It operates within solid economic, regulatory, accounting, and legal frameworks, all of which are supportive of its fundamental strength. Strong profitability; Solid and consistent banking market shares; Diversified funding strategies and strong risk management; Diversity of revenues both by business line and geographically; and Strong and growing domestic economy. Rising bad debts and impairment charges particularly in unsecured lending; Highly indebted household sector giving rise to increased affordability pressures; Relatively weak capitalization; and Increased regulatory scrutiny of retail products. U.K. banks' profitability is expected to remain strong, underpinned by growing diversity both by business line and, for the largest players, by...
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.
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