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Banking Industry Country Risk Assessment: U.K. Jan 12
Standard & Poors, Jan 2012
Abstract
Very low risk assessment of economic resilience for the U.K. stemming from a wealthy and diversified economy, and other sovereign credit strengths. Low net external funding of the banking system, deep U.K. debt capital markets, and strong government systemwide support. Moderation in the sector's risk appetite and greater competitive discipline stemming from consolidation. Credit risk in the economy owing to high private and public sector debt, exacerbated by the U.K.'s lackluster economic recovery and fiscal consolidation. Modest role of core customer deposits in funding domestic loan book. Reactive approach of the financial regulator in the past expansionary environment, although measures to strengthen the supervisory regime are under way. We have reviewed the banking sector of the United Kingdom (AAA/Stable/A-1+ unsolicited...
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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