Fitch updates bank jurisdiction operating environment scores

April 19, 2024 (MLN): Fitch Ratings has published updated bank jurisdiction operating environment scores in spreadsheet form to provide additional transparency to users of ratings.

Under both Fitch's Bank Rating Criteria and its Non-Bank Financial Institutions Rating Criteria, the assigned operating environment for a given jurisdiction is an important input into an issuer’s assigned operating environment score, which may additionally reflect issuer-specific considerations.

Since the previous publication, Ireland’s banking system operating environment score was upgraded to ‘a-’/stable from ‘bbb+’/positive, reflecting the banking sector’s improved fundamentals and continued expectations of sustained domestic economic growth and reduced household debt.

The outlook on the UK’s operating environment score of ‘aa-‘ was revised to stable from negative following the revision of the Outlook on the UK’s ‘AA-‘ sovereign rating to Stable in March.

Turkiye’s bank operating environment score was revised to ‘b’/positive from ‘b-’/stable following the upgrade of the sovereign’s Long-Term Issuer Default Rating to ‘B+’ from ‘B’, which reflected increased confidence in policy, and reduced external liquidity risks.

Armenia’s bank operating environment was upgraded to ‘bb-’/stable from ‘b+’/positive, reflecting the banking sector’s improved metrics.

Bolivia’s bank operating environment score was downgraded to ‘ccc’ from ‘ccc+’.

Costa Rica’s bank operating environment score was upgraded to ‘bb’, reflecting Costa Rica’s favourable performance against Fitch’s core operating environment metrics, Operational Risk Index, and GDP-per-capita.

Jamaica’s bank operating environment was upgraded to ‘b+’ from ‘b’ for similar reasons.

Panama’s bank operating environment outlook was revised to negative from stable, reflecting the economic slowdown, high financing costs and operating environment uncertainty.

The full list of operating environment scores is published in the associated spreadsheet, along with updated GDP and ORI data.

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