The outlook from Moody’s rating agency for Russia’s banking system has been revised to stable from negative due to “emerging signs of the country’s economic recovery which will likely benefit its banks,” RT reported. The upgrade reflects Moody’s expectation on the evolving bank creditworthiness in Russia over the next 12-18 months, the agency said. “Slow economic recovery and stabilization of macroeconomic indicators in Russia will support the operating environment for Russian banks,” said Vice President and Senior Credit Officer at Moody’s, Irakli Pipia. “We therefore expect improvements in banks’ profitability and capital retention,” he added. Moody’s expects the Russian economy to contract by only 1% this year, with “stabilization in oil prices and strong government stimulus fueling prospects for positive growth in 2017.” Russian banks are likely to post positive net profitability in 2016 and show a gradual improvement, the rating agency said.
