The outlook for global banks was slashed by credit ratings agency Moody's yesterday. Weakening economic growth, low interest rates and more volatile operating conditions will increase the credit challenges for lenders across the world, Moody's Investors Service said in a report. The agency cut its outlook from stable to negative. "Risks are on the downside for banks," said Simon Ainsworth, associate managing director at Moody's. He added: "Rising recession risk in the US and Europe, together with slowing growth... will lead to deteriorating loan quality and higher loan-loss provisioning costs." A return to monetary easing and the use of negative interest rates in some regions has ramped up the pressures on profitability.

(c) 2019 City A.M., source Newspaper