Fitch upgrades outlook of Romanian banks after Govt. revises “greed tax”
International rating agency Fitch on April 3 improved the rating outlook for Romania’s second and third-largest banks, BCR and BRD-Groupe Societe Generale, and confirmed their BBB+ long-term ratings.
Romania Insider · Journalist
· Updated · 1 min read
International rating agency Fitch on April 3 improved the rating outlook for Romania’s second and third-largest banks, BCR and BRD-Groupe Societe Generale, and confirmed their BBB+ long-term ratings.
The decision reverses the outlook downgrade operated by Fitch for the two banks from "stable" to "negative" in January. Both moves were determined by the Romanian Government first introducing then sweetening the so-called “greed tax”.
Fitch states that rating actions come after the Government amended the emergency ordinance (OUG) 114/2018 (including the “greed tax”), “indicating a moderate risk of government intervention in the banking sector.” According to Fitch, “the changes significantly reduce pressures on banks' profitability prospects, compared to the original version of OUG 114/2018 from December 2018”.
Fitch also confirmed the viability ratings (that measures banks’ resilience to shocks) of BCR and Banca Transilvania (BT) to BB+, UniCredit Bank to BB, Garanti Bank to BB- and ProCredit Bank to B+.
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