Moody's Talks - Focus on Finance: Recent Episodes
Moody's Investors Service, Ana Arsov, Danielle Reed, Mark Wasden, Bruno Baretta, Donald Robertson
Hosted by Danielle Reed of Moody's Financial Institutions team, Focus on Finance helps you keep on top of developments within the banking, insurance and asset management sectors — from the impact of tech disrupters and cyber risk to the ongoing effects of ESG and lower-for-longer interest rates. Published by Moody's Investors Service.
We discuss European banks’ ability to withstand a severe commercial real estate downturn, and how current property market weakness in APAC and China affects banks and insurers.
Speakers: Kathleen Gamper, AVP-Analyst, Moody’s Ratings; Joseph Lin, VP-Senior Analyst, Moody’s Ratings; Qian Zhu, VP-Senior Credit Officer, Moody’s Ratings
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings; Jun Yang, AVP- Research Writer, Moody’s Ratings
We talk to QuantCube Technology co-founder and CEO Thanh-Long Huynh about how machine learning and alternative data combined can identify financial trends far ahead of official data.
Speakers: Thanh-Long Huynh, co-founder and CEO of QuantCube Technology; Vincent Gusdorf, AMD, Digital Finance and AI Analytics, Moody’s Ratings
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Related research:
- Digital Transformation – Global: Alternative data's timely insights can enhance conventional data, not replace it
- Digital Transformation – Global: 2024 AI Outlook - Swift progress likely but rapid roll-out will bring risks
Strong prices, tight policy terms and higher investment yields drive a positive outlook for the global reinsurance sector.
Speaker: Brandan Holmes, VP – Senior Credit Officer, Moody’s Ratings
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Related Research:
- Reinsurance – Global: Outlook shifts to positive as improvement in risk/return dynamics gathers momentum
We talk to Alphaledger co-founder and CEO Manish Dutta about his firm’s quest to rebuild the fixed income market’s financial infrastructure, using blockchain.
Speakers: Manish Dutta, co-founder and CEO, Alphaledger; Gregory Sobel, AVP-Analyst, Moody’s Ratings
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Related Research:
- Local Government – US: Blockchain offers prospects for efficiencies, financial benefits in public finance
Cyber and climate risk are also high on the agenda at Moody’s summer 2024 insurance conferences in New York and London.
Speakers: Audio excerpts from Sarah Williams, Chief Risk Officer, Guardian Life; Brandan Holmes, VP Senior Credit Officer FIG, Moody’s Ratings; Heather Lavallee, CEO, Voya; Joe Brandon, CEO, Allegheny; Sarah Hibler, Associate Managing Director FIG, Moody’s Ratings; Ari Moskowitz, Chief Risk Officer, Everest Group; James Eck, VP Senior Credit Officer FIG, Moody’s Ratings.
Hosts: Marc Pinto, MD Financial Institutions FIG, Moody’s Ratings, Myles Neligan – Senior Research Writer, Moody’s Ratings
Related Research:
- Property & Casualty Personal Insurance – US: 2024 outlook changed to stable on rate increases, improved profitability
- Property & Casualty Insurance – US: Homeowners insurers aim to boost profits as weather-related losses, inflation take toll
- Insurers’ growing private credit investment brings more benefits than risks
- Commercial real estate risks still abound for US life insurers
- Life Insurance – Global: 2024 Outlook - Stable as higher rates offset weaker revenue, rising asset risk
Matthew White, CEO of Dubai’s Virtual Assets Regulatory Authority (VARA), explains how the regulator is trying to make it safer for financial institutions to expand into digital finance in the region.
Speakers: Matthew White, CEO of VARA; Rajeev Barma, SVP and Head of Strategy, Digital Economy, Moody’s Ratings
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Related Research:
- Decentralized Finance and Digital Assets – Global: 2024 Outlook: Digital finance slowly, steadily moves toward interoperability, standardization
- Digital Economy – Global: Islamic finance's adoption of blockchain could be beneficial, but faces crucial barriers
Our analysts discuss which segments and loan types pose the largest risks to US banks and life insurers, and zero in on concentration risks in asset portfolios.
Speakers: Evelyn Ocas Salazar, AVP-Analyst, Moody’s Ratings; Darrell Wheeler, VP-Senior Credit Officer, Moody’s Ratings; Stephen Lynch, VP-Senior Credit Officer, Moody’s Ratings,
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings; Michael Porta, VP – Senior Research Writer, Moody’s Ratings
Related Research:
- Banks – US: CRE survey loan-level analysis shows solid underwriting, high concentration risk
- Banks – US: Retained capital, strong liquidity are key credit buffers for CRE-concentrated banks
- Life Insurance — US: Commercial real estate risks still abound, especially in the office sector
Yuval Rooz, CEO of Digital Asset, shares his thoughts on the present and future use cases of blockchain technology at global financial institutions.
Speakers: Cristiano Ventricelli, VP – Senior Analyst, Moody’s Ratings; Yuval Rooz, CEO, Digital Asset
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
We discuss how differences in regional regulatory regimes and market structures affect life insurers’ allocations to private credit investments, and lay out those investments’ benefits and risks.
Speakers: Benjamin Serra, Senior Vice President, Moody’s Ratings; Will Keen-Tomlinson, VP-Senior Analyst, Moody’s Ratings
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Related research:
Life Insurance – Cross Region: Regulation contributes to material differences in private credit allocation
Insurance-Global: Insurers’ growing private credit investment brings more benefits than risks
Moody’s Ratings analysts explain why Japan’s regional banks are vulnerable to yield-curve steepening and predict strong loan growth, and higher funding costs, for India’s non-bank finance companies.
Speakers: Kensuke Ogawa, Analyst, Moody’s Ratings; C.J. Wong, AVP- Analyst, Moody’s Ratings
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Related Research:
- Regional banks – Japan: Strong liquidity will mitigate increasing risks from rising rates
- Non-bank finance companies – India: Credit fundamentals improving backed by strong economy amid rising funding costs
As the regulatory environment continues to evolve, US and European banks have sought regulatory capital relief by offloading the credit risk of loans they make via special types of transactions.
Guests: Warren Kornfeld, Senior Vice President at Moody's Ratings; Nick Monzillo, VP-Senior Analyst at Moody's Ratings; Frank Cerveny, VP-Senior Research Analyst at Moody's Ratings
Host: Aaron Johnson, VP-Senior Research Writer at Moody's Ratings
Related reports:
- Auto ABS - US: Credit-linked notes include risks not seen in typical auto ABS; issuance is rising
- Banks and Structured Finance – US: Risk transfer gives banks protection, but more capital is better; ABS implications vary
- Banks and Structured Finance – Europe: Output floor proposal could erode benefits of SRT for regulatory capital and risk management purposes
We talk to Joe Lyons of Bitsight about the growing risk from deepfakes in the age of GenAI.
Speakers: Joe Lyons, VP, Cyber Risk & Ratings Research, Bitsight; Abhi Srivastava, AVP-Analyst, Moody’s Ratings
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Related Research:
- Digital Economy – Cross Region: GenAI-powered deepfakes introduce new and transformed credit risks
Shortening the settlement cycle is a complex undertaking for a clearing house and its members, but once the transition is complete, it will reduce counterparty risk.
Speakers: Peter Nerby, Senior Vice President, Moody’s Ratings
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Related Research:
- Exchanges & Clearing Houses – North America: Shift to T+1 settlement has near-term risks for securities firms but will benefit financial markets
Alternative asset managers seek removal of barriers to private markets for individual investors. Regulators are supportive but also wary of potential dangers.
Speakers: Alexandra Aspioti, VP-Senior Analyst, Moody’s Ratings
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Related Research:
- As individual investors drive growth in private markets, risks also rise
Companies have responded to weather-related losses and higher reconstruction costs with sharp increases in premiums and tighter policy terms, and some have exited high-risk regions.
Speakers: Evelyn Ocas Salazar, AVP Analyst, Moody’s Ratings
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Related Research:
- Property & Casualty Insurance – US: Homeowners insurers aim to boost profits as weather-related losses, inflation take toll
Anthony Moro, CEO of Provenance Blockchain Foundation, joins us to talk about the technology and infrastructure developments shaping the future of financial asset tokenization.
Speakers: Rajeev Bamra, SVP and Head of Strategy, Moody’s Ratings; Anthony Moro, CEO, Provenance Blockchain Foundation
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Related Research:
- As popularity of tokenization platforms grows, so do risks to investors
- MAS initiatives will advance asset tokenization, digital money transactions
Moody’s analysts explore green finance, discussing greenwashing risk, the EU green loan market, and how clear standards and rules – and blockchain technology – could play a positive role.
Speakers: Michael Dion, VP – Senior Analyst, Moody’s Ratings; Alberto Postigo, VP – Senior Credit Officer, Moody’s Ratings; Abhi Srivastava, AVP Analyst, Moody’s Ratings
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Related Research:
- Asset Managers – Global: Despite growing regulation, greenwashing is a persistent risk
- Banking – Europe: Proposed green loan definition to support banks' alignment with climate targets
- Digital Finance – Cross Region: Blockchain can bring rigor and efficiency to ESG management, data and reporting
Basel 3.1 reforms will lead banks to apply high haircuts to unsustainably high property values and adjust mortgage risk weights to better differentiate between low-risk and high-risk loans.
Speakers: Alexander Zeidler, VP-Sr Credit Officer at Moody's Ratings; Guillaume Lucien-Baugas, VP-Senior Analyst at Moody's Ratings
Hosts: Aaron Johnson, VP-Senior Research Writer at Moody's Ratings; Danielle Reed, VP-Senior Research Writer at Moody's Ratings
Related Research:
- Basel 3.1 will reduce risk of boom and bust property cycles, boost private credit market
- Rising interest rates will weaken commercial property values and raise refinancing risk
- Explanatory comment – Haircuts smooth CRE values through the property market cycle
As cyberattacks rise and AI poses new dangers, Moody’s analysts discuss banks’ own views of their cybersecurity defenses and explain the EU’s plan to rein in risks from third-party tech providers.
Speakers: Lucas Viegas, VP-Senior Analyst, Moody’s Ratings; Brandon O’Halloran, AVP-Analyst, Moody’s Ratings
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Related Research:
- Financial Institutions – Europe: Stringent new tech rules for banks and their IT providers will improve cybersecurity
- Financial Institutions – Global: 2023 Cyber Survey - Escalating cyberthreats drive up budgets as banks fortify defenses
- Cybersecurity – Cross Region: Generative AI may increase cyber risk rather than lessen it
- Financial Institutions – Global: Ransomware attack on ICBC FS highlights cyber risks to the financial system
Our 2024 Banking System Outlooks show more European systems joining the US on negative as economies slow and loan performance weakens. China stays negative, while India is positive.
Speakers: Warren Kornfeld, Senior Vice President, Moody’s Ratings; Effie Tsotsani, VP-Senior Analyst, Moody’s Ratings; Juwon Lee, VP-Senior Analyst, Moody’s Ratings
Hosts: Carolyn Henson, VP – Senior Research Writer, Myles Neligan, VP- Senior Research Writer, Moody’s Ratings
Swedish lender Klarna’s AI assistant is driving material credit improvement this year. In the US, disclosures from Wells Fargo point to what’s ahead for banks’ commercial real estate loan performance.
Speakers: Stephen Tu, VP-Senior Credit Officer, Moody’s Ratings; Allen Tischler, Senior Vice President, Moody’s Ratings
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Ratings
Over the next several years private credit in Europe will grow, largely because of companies’ substantial refinancing needs. But banks are already fighting to gain back market share.
Speakers: Guillaume Lucien-Baugas, VP-Senior Analyst, Moody’s Ratings; Jeanine Arnold, Senior Vice President, Moody’s Ratings
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Private Credit – Europe: Europe's private credit market will accelerate, along with competition and risk
We discuss the severe thunderstorms' rising insured costs. Plus: Earnings weakness in the Medicare Advantage business and US commercial real estate exposure of German banks.
Speakers: Bernhard Held, VP-Sr Credit Officer, Moody’s Investors Service; Dean Ungar, VP-Sr Credit Officer, Moody’s Investors Service; Evelyn Ocas Salazar, AVP-Analyst, Moody’s Investors Service; Juergen Grieser, Sr Dir Mgr-Analytics & Modeling, Moody’s RMS
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Property & Casualty Insurance – US: Battered by convective storms, carriers seek higher prices, advanced models
- Health Insurance – US: Medicare Advantage continues to grow, but its profitability is weakening
- Banks – Europe: Most EU banks have limited direct exposure to US CRE, German banks are more exposed
Steve Tu, Farooq Khan and Petr Paklin of Moody's, with Joe Lyons of Bitsight, on how AI will change banks; On Fast Finance, we discuss Evergrande's liquidation and upcoming FHLBank reforms.
Speakers: David Yin, VP – Senior Credit Officer, Moody’s Investors Service; Allen Tischler, Senior Vice President, Moody’s Investors Service; Stephen Tu, VP – Senior Credit Officer, Moody’s Investors Service; Farooq Khan, VP – Senior Analyst, Moody’s Investors Service; Petr Paklin, AVP – Analyst, Moody’s Investors Service; Joe Lyons, Senior Director Cyber Risk Quantification & Ratings Research, Bitsight
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Carolyn Henson, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Property – China: Court order to liquidate China Evergrande will weaken fragile market sentiment
- Banks – US: FAQ: Initial impact of FHFA reforms of FHLBanks will be less emergency liquidity for troubled banks
- Banks – Global: Banks are well-placed for substantial efficiency gains with deep AI adoption
Cristiano Ventricelli explains how recent improvements to digital finance systems could help them gain scale. Plus, we discuss BlackRock’s recent acquisition and the SEC’s approval of spot Bitcoin ETFs.
Speakers: Abhi Srivastava, AVP – Analyst, Moody’s Investors Service; Neal Epstein, VP-Senior Credit Officer, Moody’s Investors Service; Cristiano Ventricelli, VP-Senior Analyst
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Decentralized Finance and Digital Assets – Cross Region: SEC approves spot Bitcoin ETFs, advancing cryptocurrency institutionalization
- BlackRock, Inc.: Acquisition of Global Infrastructure Partners is credit positive
- Decentralized Finance and Digital Assets – Global - 2024 Outlook: Digital finance slowly, steadily moves toward interoperability, standardization
Our global outlook for the sector remains negative for 2024, but the picture for non-bank finance companies is more varied than a year ago, with easing conditions in some markets and businesses.
Speakers: Bruno Baretta, AVP – Analyst, Moody’s Investors Service
Host: Michael Porta, VP – Senior Research Writer, Moody’s Investors Service
Weak results in personal lines drive the negative outlook for property and casualty insurance, while life insurance benefits from higher interest rates.
Speakers: Bruce Ballentine, VP – Senior Credit Officer, Moody’s Investors Service; Christian Badorff, VP – Senior Credit Officer, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service
James Eck and Brandan Holmes explain how rising physical climate-related claims complicate insurers' risk management; Olivier Panis discusses benefits for banks of enhanced climate change reporting.
Speakers: Olivier Panis, Senior Vice President, Moody’s Investors Service; James Eck, VP-Senior Credit Officer, Moody’s Investors Service; Brandan Holmes, VP-Senior Credit Officer, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Insurance – Global: Rising physical climate risk generates uncertainty, complicates risk management
- P&C Insurance and State Government — US: Sharp pricing hikes draw reinsurers to Florida; insurance market strains continue
- Enhanced climate change reporting will help banks manage risks
The boost banks have enjoyed for the last two years will start to fade as high rates translate into higher funding costs and lower growth. But the outlook for banks is not so gloomy everywhere.
Speaker: Felipe Carvallo, VP-Senior Credit Officer, Moody’s Investors Service
Host: Erin McDermott, AVP – Research Writer, Moody’s Investors Service
Reduced economic growth could lower financial institutions’ profitability, but there are also opportunities to sell retirement products and new forms of insurance.
Speakers: Qian Zhu, VP-Senior Credit Officer, Moody’s Investors Service; Kelvin Kwok, AVP-Analyst, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Demographics – China: Aging population, smaller workforce will have broad implications across sectors
- Life Insurance – China: Aging population offers growth opportunities, with risks and competition
- Insurance – China: Latest policies for health insurance improve diversification but raise underwriting risks
Moody’s analysts discuss how lenders are managing the risks created by the end of the low-interest-rate era, and explore the favorable funding and liquidity characteristics of universal banks.
Speakers: Yasuko Nakamura, VP – Senior Credit Officer, Moody’s Investors Service; Edoardo Calandro, VP – Senior Credit Officer, Moody’s Investors Service
Hosts: Carolyn Henson, VP – Senior Research Writer, Moody’s Investors Service; Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Banking – Global: Interest rates and the banking book: risks and regulation
- Banks – Cross Region: Universal banks’ superior funding and reserves offset liquid asset encumbrance
Private credit lenders built stores of capital that we expect will be put to work competing with banks to fund a new wave of leveraged buyouts. In the first segment of this episode, we discuss LBO competition and the risks it poses. Later, our guest lays out the concentration of private credit among a handful of giant asset managers building their own, largely self-contained lending ecosystems.
Guests: Christina Padgett, Associate Managing Director and Sandra Veseli, Managing Director, both from Moody’s Investors Service’s Corporate Finance Group; and Rory Callagy, Associate Managing Director, with Moody’s Financial Institutions Group.
Host: Jeff Pruzan, Vice President – Senior Research Writer, Moody’s Investors Service.
To read more on this topic, visit Moodys.com. (Some content available only to registered users or subscribers.)
Links:
- Private Credit – Global: Syndicated and private lenders will spar as LBOs revive, upping systemic risk
Moody’s analysts C.J. Wong and Yulia Wan discuss ongoing real estate market weakness in China and Vietnam, and explain how the credit effects will differ in each country.
Speakers: C.J. Wong, Analyst, Moody’s Investors Service; Yulia Wan, VP-Senior Analyst, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Additional Research:
- Banks – Asia-Pacific: Ongoing real estate sector stress raises credit risks for banks in China and Vietnam
Moody’s analysts Marat Faritov and Cristiano Ventricelli discuss how digital bonds could reshape debt markets, and the hurdles to be overcome before the technology can be more widely adopted.
Speakers: Marat Faritov, AVP – Analyst, Moody’s Investors Service; Cristiano Ventricelli, AVP – Analyst, Moody’s Investors Service
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Digital bonds' features could transform debt markets over time
- US Congress works toward digital assets rules, but bills lack bipartisan support
- Cyber risk looms as digital bonds gain traction
- Decentralized Finance and Digital Assets – Europe: Swiss digital bonds benefit from favorable existing and adapted federal laws
- DeFi & Digital Assets: What is digital finance? Explanation and glossary
Moody’s analysts Laline Carvalho-Neff and James Eck explain how reinsurers have boosted their profitability, even as natural catastrophes have grown more frequent and more severe.
Speakers: Laline Carvalho-Neff, VP-Senior Analyst, Moody’s Investors Service; James Eck, VP-Senior Credit Officer, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Reinsurance – Global: Stable outlook as higher pricing restores more favorable risk and reward dynamic
- P&C Insurance and State Government — US: Sharp pricing hikes draw reinsurers to Florida; insurance market strains continue
- Reinsurance – Global: Reinsurance prices to keep rising through 2024, buyer survey suggests
Moody’s analysts discuss how a rate rise would affect Japan’s banks, Swedish banks’ high exposure to indebted real estate firms, and the stability of Swiss domestic bank deposits.
Speakers: Tetsuya Yamamoto, VP – Senior Credit Officer, Moody’s Investors Service; Louise Welin, VP – Senior Credit Officer, Moody’s Investors Service; Goetz Thurm, VP Senior Analyst, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Banks – Japan: A rise in domestic interest rates would bring more benefits than risks
- FAQ: Sweden's real estate turmoil creates risks for local banks
- Banks – Switzerland: Stable domestic deposits, strong liquidity reduce the risk of deposit outflows
Moody’s analysts discuss the economic and credit outlook for China, including the role of local government financing vehicles (LGFVs) and their debt burdens, and the latest on the property sector.
Speakers: Lillian Li, VP-Senior Credit Officer, Moody’s Investors Service; Jessie Tung, VP-Senior Credit Officer, Moody’s Investors Service
Host: Vittoria Zoli, Analyst – Emerging Markets, Moody’s Investors Service
Steve Tu discusses FedNow, a new US digital payments system, and why it could exacerbate deposit flight risk for banks. Farooq Khan explains the risks of higher interest rates for UK mortgage lenders.
Speakers: Stephen Tu, VP – Senior Credit Officer, Moody’s Investors Service; Farooq Khan, VP – Senior Analyst, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Banks – North America: FedNow launch may lower transaction costs, but exacerbate funding risks for banks
- Asset and customer relations risks intensify for UK lenders as rates keep rising
Moody’s analysts David Burger, Mark Wasden and Neal Epstein explain how differences in structure and asset risk give rise to divergent credit profiles among the three investment vehicles.
Speakers: David Burger, VP – Senior Credit Officer, Moody’s Investors Service; Mark Wasden, Senior Vice President, Moody's Investors Service; Neal Epstein, VP – Senior Credit Officer, Moody's Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Aaron Johnson, VP – Senior Research Writer, Moody’s Investors Service
Moody's Marc Pinto talks to Guggenheim Partners Investment Management’s Anne Walsh about big risks – and opportunities – for insurers, asset managers and institutional investors.
Speakers: Marc Pinto, Managing Director, Moody’s Investors Service; Anne Walsh, Chief Investment Officer, Guggenheim Partners Investment Management
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Life Insurance – US: Commercial real estate downturn could weaken portfolio asset quality
- US life insurers have strong capital levels heading into uncertain economic environment
- Property & Casualty Insurance – Global: Cyber insurance market stabilizes as profitability improves
US life insurers have significant commercial real estate exposure, mitigated by a low share of holdings in office properties and high share of investments in senior investment-grade fixed income.
Speakers: Evelyn Ocas Salazar, AVP-Analyst, Moody’s Investors Service; Manoj Jethani, VP-Senior Credit Officer, Moody’s Investors Service
Host: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Life Insurance – US: Commercial real estate downturn could weaken portfolio asset quality
Vladlen Kuznetsov explains why banks in emerging markets are exposed to environmental risks, and Laline Carvalho-Neff discusses global reinsurers' strong first-quarter results.
Speakers: Vladlen Kuznetsov, AVP – Analyst, Moody’s Investors Service; Laline Carvalho-Neff, VP – Senior Analyst, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Governance and external support mitigate environmental and social risks for banks in emerging markets
- Reinsurance – US & Bermuda: Everest, RenaissanceRe, AXIS Capital, Arch: Strong Q1 results, pricing boost 2023 prospects
In this episode, we discuss China’s stabilizing property sales and improving funding conditions.Then at 9:00, we look at Chinese insurers’ and banks’ exposure to the country’s property sector.
Guests: Kelly Chen from the Corporate Finance Group of Moody’s Investors Service, and Qian Zhu and Yulia Wan from the Financial Institutions Group.
Host and Segment Leads: Tania Hall, Livia Yap and Danielle Reed from the Research team at Moody’s Investors Service.
To read more on this topic, visit the Behind the Bonds and Focus on Finance pages on Moodys.com (some content only available to registered users or subscribers).
Related Research:
- Chinese property market weakness will persist in 2023, dragging on credit quality in multiple sectors
- FAQ about mortgage prepayment to Chinese banks
- FAQ on Chinese insurers' exposure to the property sector
Jerome Cheng and Tengfu Li discuss how China’s economic rebound will support residential mortgage-backed securities and a handful of Asia-Pacific banking systems with close ties to the country.
Speakers: Tengfu Li, AVP – Analyst, Moody’s Investors Service; Jerome Cheng, Associate Managing Director, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Aaron Johnson, VP – Senior Research Writer, Moody’s Investors Service
Related content on Moodys.com (may only be available to registered users or subscribers):
- RMBS – China: Economic rebound, low rates and policy support are positive for mortgage borrowers
- Banks – Asia-Pacific: China's reopening will benefit only a few banking systems in Asia-Pacific
Jill Cetina explains the main risks we are watching for US banks following recent rating actions. Plus, a cross-regional look at how central bank digital currencies could transform payments.
Speakers: Melina Skouridou, VP – Senior Analyst, Moody’s Investors Service; Lucas Viegas, VP – Senior Analyst, Moody’s Investors Service; Vincent Gusdorf, SVP, Moody’s Investors Service; Jill Cetina, Associate Managing Director, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service
Related content on Moodys.com (may only be available to registered users or subscribers):
- Financial Institutions – Global: FAQ: Cross-border, interoperable CBDCs could transform global payments
- Financial Institutions – Brazil: Brazil’s central bank digital currency is the next step in its digital finance transformation
- Banks – US: Elevated interest rate and funding risks weaken credit strength of select US banks
Moody's analysts discuss high-profile departures from the Net Zero Insurance Alliance, plus increasing GCC bank mergers, and why Japan's largest banks can resist US banking sector stress.
Speakers: Tetsuya Yamamoto, VP – Senior Credit Officer, Moody’s Investors Service; Francesca Paolino, Analyst, Moody’s Investors Service; Brandan Holmes, VP – Senior Credit Officer, Moody’s Investors Service; James Eck, VP – Senior Credit Officer, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service
Related content on Moodys.com (may only be available to registered users or subscribers):
- Banks – Middle East: More M&A activity ahead as GCC banks build scale, revenue and cost synergies
- Banks – Japan: Ample liquidity backed by stable deposits will limit impact of US bank distress on large banks
- Reinsurance — Global: Catastrophe PML disclosures show divergence in risk appetites among firms
- Insurance – Cross Region: Antitrust fears weaken insurers' net zero alliance, hindering decarbonization plans
Moody’s analysts discuss accelerating electric vehicle sales’ effects on US auto insurers and auto finance captives, and implications for state fuel taxes.
Speakers: Matthias Heck, VP – Senior Credit Officer, Moody’s Investors Service; Inna Bodeck, VP – Senior Analyst, Moody’s Investors Service; Jasper Cooper – VP – Senior Credit Officer, Moody’s Investors Service; Ted Hampton, VP – Senior Credit Officer, Moody’s Investors Service
Hosts:
Nicholas Samuels, Senior Vice President, Moody’s Investors Service; Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related content on Moodys.com/autotransformation (may only be available to registered users or subscribers):
- Electrification momentum is strong, automakers must invest to stay competitive
- US auto finance captives’ evolving portfolios will carry more electric vehicles and greater risk
- Auto insurers’ costs and pricing will rise as electric vehicles grow more popular
- Electric vehicles raise carbon transition risk for states' highway revenue bonds
Moody’s analysts discuss the rescue of Credit Suisse, and explain why some fintechs have thrived even in adversity. Also, a look at the ongoing effects of the Russia-Ukraine conflict on CIS banks.
Speakers: Michael Rohr, Senior Vice President, Moody’s Investors Service; Dietmar Hornung, Associate Managing Director, Moody’s Investors Service; Vladlen Kuznetsov, AVP – Analyst, Moody’s Investors Service; Petr Paklin, AVP – Analyst, Moody’s Investors Service; Daniel Yu, VP – Senior Credit Officer, Moody’s Investors Service; Arlene Sohn, Analyst, Moody’s Investors Service; Rodrigo Marimon Bernales, Analyst, Moody’s Investors Service; David Yin, VP – Senior Credit Officer, Moody’s Investors Service
Hosts: Carolyn Henson – VP, Senior Research Writer, Moody’s Investors Service; Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Financial Stability – Switzerland: Low sovereign credit risks from events leading to UBS's takeover of Credit Suisse unless contagion spreads
- Banks – Europe: Credit Suisse rescue and related liquidity measures protect senior bank creditors, but AT1 bondholders bear a cost
- Banks - Commonwealth of Independent States: Ukraine invasion provides gains for some CIS banks but long-term challenges mount
- Banks – Australia: Challenges for new banks are increasing but opportunities to grow still remain
- Banking – South Korea: Expansion of Korea's virtual banks a credit negative for incumbents
- Banks – Mexico: How challengers are unlocking Mexico's underserved credit market
Moody’s analysts discuss recent developments in the US and European banking systems, the implications for monetary policy and potential spillovers to emerging markets across the globe.
Speakers: Donald Robertson, AMD – Financial Institutions, Moody’s Investors Service; Nick Hill, MD – Financial Institutions, Moody’s Investors Service; Eugene Tarzimanov, VP – Senior Credit Officer, Moody’s Investors Service; Scott Phillips, AMD – Global Emerging Markets, Moody’s Investors Service
Hosts: Shirin Mohammadi, VP – Senior Research Writer, Moody’s Investors Service; Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
For related research, visit the Global Banking System Outlook topic page.
As financial pressures mount in a time of higher rates and slowing growth, Moody’s will continue to share our analysis of evolving trends and repercussions for banks around the world.
Moody's analysts discuss how emerging markets banks have evolved to compete with new entrants, and explain why fintechs globally are on shakier financial ground.
Speakers: Stephen Tu, VP – Senior Credit Officer, Moody’s Investors Service; Alexandre Albuquerque, VP – Senior Analyst, Moody’s Investors Service; Petr Paklin, AVP – Analyst, Moody’s Investors Service; Tengfu Li, AVP – Analyst, Moody’s Investors Service
Hosts: Erin McDermott, AVP – Research Writer, Moody’s Investors Service; Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related Links:
- Banking – Global: Fintechs lose financial footing, tipping scales in favor of incumbents, for now
- Banks – Emerging Markets: Incumbent banks evolve to head off new entrants
We explore this year’s outlook for crypto and digital asset firms, and check in on financial repercussions a year after Russia's seizure of leased aircraft.
Speakers: Benjamin Serra, SVP, Moody’s Investors Service; Mark Wasden, SVP, Moody’s Investors Service; Jayesh Joseph, AVP – Analyst, Moody’s Investors Service; Vincent Gusdorf, SVP, Moody’s Investors Service; Alexandra Aspioti, VP – Senior Analyst, Moody’s Investors Service
Hosts: Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service; Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Geopolitical Risks – Global: Payouts on aircraft lost in Russia pose risk to insurers but will aid lessors and lease ABS
- Decentralized Finance — Global: 2023 outlook: Crypto firms’ credit quality weaker, but key technologies to advance
- Asset Management – Cross Region: Blockchain-enabled tokenization will boost growth in private assets
Helena Kingsley-Tomkins explains what’s behind insurance outlooks in Europe. In Fast Finance: troubles in real estate extend to Vietnam’s banks, and a look at Indian banks’ exposure to Adani Group.
Speakers: Srikanth Vadlamani, VP – Senior Credit Officer, Moody’s Investors Service; Joyce Ong, AVP – Analyst, Moody’s Investors Service; Helena Kingsley-Tomkins, VP – Senior Analyst, Moody’s Investors Service
Hosts: Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service; Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Risks from real estate and rising interest rates will undermine banks' credit profiles:
- Strong economic growth will offset strain on asset quality and profitability, supporting stable outlook
- Banks – India: Risks from Adani exposure are limited but can increase
- Insurance – Europe: Inflation underpins negative P&C outlook, life stable on higher interest rates
Tomoya Suzuki talks about the digital payments push in Japan, and Rebecca Tan explains why the outlook is brighter for India’s public sector banks.
Speakers: Tomoya Suzuki, VP – Senior Analyst, Moody’s Investors Service; Rebecca Tan, VP – Senior Analyst, Moody’s Investors Service
Hosts: Jun Yang, AVP – Research Writer, Moody’s Investors Service; Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Banks – Japan: Push for digital transactions is credit negative for regional banks
- Moody's takes positive rating actions on four Indian public sector banks
- Banks – India: Rising rates will have limited impact on Indian banks' credit profiles
Moody's analysts discuss crypto asset regulation, credit developments at Silvergate Bank and foreign currency fluctuation risks for emerging markets banks and Asia-Pacific financial institutions.
Speakers: Stephen Tu, VP – Senior Credit Officer, Moody’s Investors Service; Sadia Nabi, VP – Senior Analyst, Moody’s Investors Service; Eugene Tarzimanov, VP – Senior Credit Officer, Moody’s Investors Service; Jungmin Arlene Sohn, Analyst, Moody’s Investors Service
Hosts: Carolyn Henson, VP – Senior Research Writer, Moody’s Investors Service; Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Moody's downgrades Silvergate Bank's long term deposit rating to Ba1, outlook negative
- Financial Institutions – Global: Regulators' vigilance on cryptoasset risks, credit positive for banks, also has broader implications
- Banks - Emerging markets: Foreign-currency risk is acute for some banking systems
- Financial institutions – Asia-Pacific: Risks from local-currency depreciation are limited, except for some finance companies
Bruno Baretta explains how weak macroeconomic conditions are increasing credit risk for finance companies globally despite a possible profitability boost for some companies from rising interest rates.
Speaker: Bruno Baretta, AVP – Analyst, Moody’s Investors Service
Hosts: Michael Porta, VP – Senior Research Writer, Moody’s Investors Service; Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Related content on Moodys.com (some content only available to registered users or subscribers):
- Finance Companies — Global: 2023 outlook negative with funding and asset quality weakening
Claims inflation and higher reinsurance costs loom large in the outlook for P&C insurance, while life insurers see enough benefit from higher interest rates to offset economic turbulence, for now.
Speakers: Manoj Jethani, VP – Senior Credit Officer, Moody’s Investors Service; Christian Badorff, VP – Senior Credit Officer, Moody’s Investors Service
Hosts: Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service; Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service
Against an uncertain global economic backdrop, hosts Carolyn Henson and Michael Porta talk to Moody’s analysts Edoardo Calandro, Rita Sahu and Nicholas Zhu about prospects for global banks in 2023.
Speakers: Edoardo Calandro, VP – Senior Credit Officer, Moody’s Investors Service; Rita Sahu, VP – Senior Credit Officer, Moody’s Investors Service; Nicholas Zhu, VP – Senior Credit Officer, Moody’s Investors Service
Hosts: Carolyn Henson, VP – Senior Research Writer, Moody’s Investors Service; Michael Porta, VP –Senior Research Writer, Moody’s Investors Service
Related Research:
- Banks – Global: 2023 outlook stable as rising rates, strong balance sheets counter global slowdown
- Banking System Outlook – China: Deteriorating operating environment drives negative outlook
Jill Cetina and David Fanger explain how this round of quantitative tightening will affect bank funding and capital. Plus, Coinbase faces higher risks, and Twitter’s lenders face markdowns.
Speakers: Jill Cetina, Associate Managing Director, Moody’s Investors Service; David Fanger, SVP, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Erin McDermott, AVP –Research Writer, Moody’s Investors Service
Related Research:
- Banks – Cross Region: Twitter underwriting losses thus far appear moderate for syndicate banks
- Moody's reviews Coinbase (Ba3 corporate family) for downgrade
- Coinbase Global, Inc.: FTX implosion leaves vacuum in crypto space, a credit negative for Coinbase
- Federal Reserve’s second round of quantitative tightening will have pronounced effects on banks
Vincent Gusdorf, Fadi Massih and Warren Kornfeld discuss the aftermath of the FTX bankruptcy and explain how crypto finance risks could spill over into traditional financial institutions.
Speakers: Vincent Gusdorf, Senior Vice President, DeFi & Digital Assets, Moody’s Investors Service; Fadi Massih, VP – Senior Analyst, Moody’s Investors Service; Warren Kornfeld, Senior Vice President, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Michael Porta, VP – Senior Research Writer, Moody’s Investors Service
As COP 27 winds down, Shree Khare and Tomoya Suzuki discuss Japan's rising natural catastrophe risks, and Megan Fox and Brandan Holmes explain what's driving banks' and insurers' net zero plans.
Speakers: Shree Khare, Vice President of Model Development, RMS; Tomoya Suzuki, VP – Senior Analyst, Moody’s Investors Service; Megan Fox, VP – Senior Analyst, Moody’s Investors Service; Brandan Holmes, VP – Senior Credit Officer, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service
Related Research:
- Banks’ net zero financed emissions plans show progress, underscore challenges
- Insurance – Global: Net zero plans help insurers manage carbon transition risks
Srikanth Vadlamani explains why Indian banks’ loans will perform well despite rising interest rates, and Eugene Tarzimanov discusses the threat to Asia-Pacific banks from China’s slowing economy.
Speakers: Srikanth Vadlamani, VP – Senior Credit Officer, Moody’s Investors Service; Eugene Tarzimanov, VP – Senior Credit Officer, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Jun Yang, AVP – Research Writer, Moody’s Investors Service
Kelvin Kwok, Mattias Frithiof and Farooq Khan explain the implications of inflation and rising interest rates for Asia-Pacific insurers and Western European and UK banks.
Guests: Kelvin Kwok, AVP - Analyst, Moody’s Investors Service; Mattias Frithiof, AVP – Analyst, Moody’s Investors Service; Farooq Khan, VP – Senior Analyst, Moody’s Investors Service
Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Myles Neligan, VP – Senior Research Writer, Moody’s Investors Service
Related content on Moodys.com (some content only available to registered users or subscribers):
- Life insurance – Asia-Pacific: Asset and liability management will remain disciplined amid rising rates
- Banks – Western Europe: Rising rates bring clear margin gains for European banks, but higher costs and loan impairments will offset benefits
- Banks and Building Societies – United Kingdom: Headwinds from affordability shock to dampen profitability boost from rate rises
James Eck explains that with insured loss estimates of up to roughly $70 billion, earnings of property insurers and reinsurers will fall sharply, and some reinsurers could face capital erosion.
Guests: James Eck, Vice President – Senior Credit Officer, Moody’s Investors Service
Hosts: Danielle Reed, Vice President – Senior Research Writer, Moody’s Investors Service
To read more on this topic, visit Moodys.com (some content available only to registered users or subscribers).
- P&C Insurance and State Government – US: Hurricane Ian hits insurers' Q3 earnings; capital erosion risk for some (re)insurers
- Reinsurance – US: Reinsurers diverge on property catastrophe coverage in Florida; higher pricing ahead
Louise Welin and Maria Gillholm discuss difficulties ahead for Swedish mortgage borrowers and real estate companies, and implications for banks. Also, new business is slowing for US mortgage insurers.
Guests: Bob Garofalo, Vice President – Senior Credit Officer, Moody’s Investors Service; Louise Welin, Vice President – Senior Credit Officer, Moody’s Investors Service; Maria Gillholm, Vice President – Senior Credit Officer, Moody’s Investors Service
Hosts: Danielle Reed, Vice President – Senior Research Writer, Moody’s Investors Service, and Myles Neligan, Vice President – Senior Research Writer, Moody’s Investors Service
To read more on this topic, visit Moodys.com (some content available only to registered users or subscribers).
- Financial Institutions – Sweden: Higher central bank rates are credit positive for banks, but asset risks are building
- Mortgage Insurance – US: Profitability remains high as housing market begins to cool
- Cross Sector – Sweden: Real estate refinancing risk worsens, but impact on banks manageable
Rajeev Bamra and Sadia Nabi discuss regulation of global cryptoassets and stablecoins in the US. Also: a proposal to clear certain Treasurys trades, and banks' risks from conflict in Nagorno-Karabakh.
Guests: Rajeev Bamra, head of DeFi and Digital Assets Strategy, Moody’s Investors Service; Sadia Nabi, Vice President – Senior Analyst, Moody’s Investors Service; Lev Dorf, Assistant Vice President – Analyst, Moody’s Investors Service; Donald Robertson, Associate Managing Director, Moody’s Investors Service
Hosts: Danielle Reed, Vice President – Senior Research Writer, Moody’s Investors Service, and Michael Porta, Vice President – Senior Research Writer, Moody’s Investors Service
C.J. Wong explains the forces behind Vietnamese banks’ credit strength, and Rebecca Tan discusses inflation's impact on banks in six member states of the Association of Southeast Asian Nations.
Guests: C.J. Wong, Analyst, Moody’s Investors Service; Rebecca Tan, Vice President – Senior Analyst, Moody’s Investors Service
Hosts: Danielle Reed, Vice President – Senior Research Writer, Moody’s Investors Service, and Jun Yang, Assistant Vice President – Research Writer, Moody’s Investors Service
To read more on this topic, visit Moodys.com (some content available only to registered users or subscribers).
- Banking System Outlook – Vietnam: Economic rebound and improving profitability support positive outlook
- Government of Vietnam: FAQ on economic prospects, environmental risks and institutional challenges
- Rating Action: Moody's takes rating actions on 12 Vietnamese banks
- Banks – ASEAN: Inflation-driven rate rises will boost margins but rapid increases would be credit negative
Badis Shubailat and Tengfu Li discuss how high commodity prices are supporting the recovery of Islamic banks, and Alexandra Aspioti explains why GCC fund managers are optimistic.
Guests: Alexandra Aspioti, Vice President – Senior Analyst, Moody’s Investors Service; Badis Shubailat, Analyst, Moody’s Investors Service, and Tengfu Li, Assistant Vice President – Analyst, Moody’s Investors Service
Hosts: Danielle Reed, Vice President – Senior Research Writer, Moody’s Investors Service, and Carolyn Henson, Vice President – Senior Research Writer, Moody’s Investors Service
Related content on Moodys.com (some content only available to registered users or subscribers):
- Funds & Asset Management – Middle East: GCC fund firms expect oil price surge to support AUM and net inflows
- Islamic finance – Cross region: High commodity prices will sustain the recovery of Islamic banks
Helena Kingsley-Tomkins explains why the outlook for global reinsurance is stable, despite higher natural catastrophe losses, and James Eck discusses the prospects for alternative capital.
Guests: Helena Kingsley-Tomkins, Vice President – Senior Analyst, Moody’s Investors Service and James Eck, Vice President – Senior Credit Officer, Moody’s Investors Service
Hosts: Danielle Reed, Vice President – Senior Research Writer, Moody’s Investors Service, and Myles Neligan, Vice President – Senior Research Writer, Moody’s Investors Service
Related content on Moodys.com (some content only available to registered users or subscribers):
- Reinsurance – Global: Stronger earnings prospects and solid balance sheets underpin stable outlook
- Reinsurance – Global: Buyers’ survey indicates claims inflation is driving reinsurance pricing momentum
- Reinsurance – Global: Buyers’ survey indicates claims inflation is driving reinsurance pricing momentum
- Reinsurance – Global: Alternative capital market poised to resume growth on higher reinsurance pricing
Bernhard Held and Petter Bryman discuss the implications for certain European banking systems of a reduction in Russian energy supply, and Alessandro Roccati discusses recent credit developments at Credit Suisse following large losses.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Sovereign – Europe: Looming gas crisis intensifies credit pressures for Europe’s most exposed sovereigns
- Banking – Europe: Gas supply rationing would lift problem loans from benign levels
- Credit Suisse Group AG: Update following rating action
- Credit Suisse Group AG 2024 plan: reduced risk appetite and greater shift to wealth management will lower risks and earnings volatility
- Credit Suisse Group AG Q4 2021: Weak revenue, goodwill impairment and litigation charges led to large loss
- Credit Suisse Group AG: Q2 2022: Weak revenues and litigation charges lead to large loss
Fabio Iannò explains why European banks will benefit from the ECB's recent increase in key interest rates, and Felipe Carvallo discusses how the sale of certain Citibanamex business operations will alter Mexico’s banking sector.
Guests: Felipe Carvallo, Vice President – Senior Credit Officer, Moody’s Investors Service, and Fabio Iannò, Vice President – Senior Credit Officer, Moody’s Investors Service
Hosts: Danielle Reed, Vice President – Senior Research Writer, Moody’s Investors Service and Myles Neligan, Vice President – Senior Research Writer, Moody’s Investors Service
Stephen Tu explains why Apple’s new Pay Later initiative may have important implications for financial institutions; Saranga Ranasinghe and Frank Mirenzi tell us about future growth in and risks to Australia’s pension (“superannuation”) sector.
Guests: Saranga Ranasinghe, Vice President – Senior Analyst, Corporate Finance Group, Moody’s Investors Service; Frank Mirenzi, Vice President – Senior Credit Officer, Financial Institutions Group, Moody’s Investors Service; Stephen Tu, Vice President – Senior Credit Officer, Financial Institutions Group, Moody’s Investors Service
Hosts: Danielle Reed, Vice President – Senior Research Writer, Moody’s Investors Service and Carolyn Henson, Vice President – Senior Research Writer, Moody’s Investors Service
Yulia Wan and Sean Hung discuss the implications for financial institutions of China's policy focus on financial stability. Plus, Eugene Tarzimanov and Yaroslav Sovgyra discuss how inflation will affect banks in emerging economies.
Guests: Yulia Wan, Vice President – Senior Analyst, Financial Institutions Group, Moody’s Investors Service; Sean Hung, Vice President – Senior Credit Officer, Financial Institutions Group, Moody’s Investors Service; Eugene Tarzimanov, Vice President – Senior Credit Officer, Moody’s Investors Service, and Yaroslav Sovgyra, Associate Managing Director, Financial Institutions Group, Moody’s Investors Service
Hosts: Danielle Reed, Vice President – Senior Research Writer, Moody’s Investors Service and Myles Neligan, Vice President – Senior Research Writer, Moody’s Investors Service
Neal Epstein explains how comparatively strong credit performance and returns draw asset managers to private credit despite high borrower leverage. Warren Kornfeld and Clay Montgomery cover the growing role of non-banks, including BDCs, in the space.
Guests: Neal Epstein, Vice President – Senior Credit Officer, Funds & Asset Management, Moody’s Investors Service; Warren Kornfeld, Senior Vice President, Banking, Moody’s Investors Service, and Clay Montgomery, Vice President, Senior Analyst, Banking, Moody’s Investors Service
Hosts: Danielle Reed, Vice President – Senior Research Writer, Moody’s Investors Service and Michael Porta, Vice President – Senior Research Writer, Moody’s Investors Service
Rajeev Bamra explains why crypto markets are unlikely to allow mass sanctions evasion. Plus, Sarah Hibler explains why Russia’s invasion of Ukraine adds to uncertainty for cyber insurers in an already difficult operating environment.
Guests: Rajeev Bamra, Vice President – Strategy & Business Management, Moody’s Investors Service, and Sarah Hibler, Associate Managing Director, Moody’s Investors Service
Hosts: Danielle Reed, Vice President – Senior Research Writer, Moody’s Investors Service and Myles Neligan, Vice President – Senior Research Writer, Moody’s Investors Service
Sovereigns – Global: Use of cryptocurrencies to evade sanctions will be limited by market size and liquidity
Financial Institutions – Global: Digital asset regulation comes into focus, and authorities have shown they can often follow the money
P&C Insurance – Global: Cyber insurers raise rates, narrow coverage as military conflict in Ukraine heightens risk
Tom Aaron of the Public Finance team and Shachar Gonen of the Insurance team explore the reasons public pension funds and insurance companies have found private equity and private credit such compelling investments, and why public pension funds face higher risk than insurers from these assets.
Guests: Thomas Aaron, Vice President – Senior Credit Officer, Moody’s Investors Service; Shachar Gonen, Vice President – Senior Credit Officer, Moody’s Investors Service;
Hosts: Danielle Reed, Vice President – Senior Research Writer, Moody’s Investors Service and Michael Porta, Vice President – Senior Research Writer, Moody’s Investors Service
As mental health and substance abuse problems grow sharply in the US, insurance analyst Dean Ungar explains how US health insurers are trying to break down the wall between medical health and mental health and better integrate the latter into their operations. Also in this episode, insurance analysts Frank Yuen, Soichiro Makimoto and Qian Zhu discuss updates to capital regimes in Asia-Pacific, and what it means for insurers in Japan, mainland China and Hong Kong SAR, China.
Guests: Dean Ungar, Vice President – Senior Credit Officer, Moody’s Investors Service; Qian Zhu, Vice President – Senior Credit Officer, Moody’s Investors Service; Frank Yuen, Vice President – Senior Analyst, Moody’s Investors Service, and Soichiro Makimoto, Vice President – Senior Analyst, Moody’s Investors Service.
Hosts: Danielle Reed, Vice President – Senior Research Writer, Moody’s Investors Service and Myles Neligan, Vice President – Senior Research Writer, Moody’s Investors Service
Financial Institutions team analysts Allen Tischler and Jasper Cooper talk about the effects of higher inflation on global banks, insurance companies and asset managers, and explain why the negatives outweigh the positives.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Financial Institutions – Cross Region: Risks of prolonged high inflation outweigh rate hike benefits
Analysts Olivier Panis, Bernhard Held and Antonello Aquino from the Financial Institutions team discuss the implications of a prolonged military conflict in Ukraine for banks and insurance companies, while Insurance analyst Laura Bazer focuses on the effects of long COVID claims on life insurers globally.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Life Insurance — Global: Long COVID early assessment: despite likely rise in claims, credit effects limited
- Financial Institutions – Global: Deteriorating global economic conditions broaden risks for the financial sector
- Banks, securities firms, finance companies – Global: Ripple effects from Ukraine crisis are creating harsher business conditions
- Insurers, Asset Managers – Global: Ukraine crisis adds to inflation and market volatility risk for insurers, asset managers
- Geopolitical Risks – Global: European utilities and energy-intensive companies among hardest hit by potential cut-off in Russian energy supplies
Banking analysts Louise Welin, Rita Sahu, Eugene Tarzimanov and Felipe Carvallo explain how global macroeconomic and geopolitical forces have shaped the outlooks for 32 of the world’s biggest banking systems, as the military conflict in Ukraine slows the global economy’s recovery from the coronavirus pandemic.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Research Announcement: Moody's maintains stable outlooks on most LATAM banking systems
- Research Announcement: Moody's maintains stable outlook on majority of APAC banking systems
- Research Announcement: Moody’s updates banking system outlooks for 10 European countries after Russia’s invasion of Ukraine
- Research Announcement: Moody's - US banking system will remain stable given expected credit fundamentals
- Research Announcement: Moody's - Credit outlook for Canada's banking system is stable
Felipe Carvallo of the Banking team explains how pension reform plans of Chile’s new young president could shake up banking and asset management. Plus, Banking team analyst Fadi Massih talks about how cryptocurrency is traceable, and what upcoming regulation means for cryptocurrency exchanges and other digital asset platforms.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Financial Institutions – Global: Digital asset regulation comes into focus, and authorities have shown they can often follow the money
- Banking – United States of America: US order seeking digital asset transparency and oversight would limit risks, promote financial stability
- Political Risk – Chile: FAQ on policy risks and credit effects across sectors as Boric administration takes office
- Government of Chile: Guaranteed Universal Pension will address social demands at relatively modest near-term fiscal costs
- The State of the Chilean Consumer: July 2021: Pension savings withdrawals and stimulus measures are boosting consumption
- Funds & Asset Management – Latin America & Caribbean: Proposal to reform Mexico's retirement system is credit positive for private pension fund asset managers
Insurance team analyst Helena Kingsley-Tomkins discusses Tesla’s move into high-tech auto insurance and how it will affect the competitive landscape. Plus, Mark Wasden of the Banking team and Gideon Lubin of the Structured Finance team explain how sanctions on Russian businesses and assets will affect aircraft leasing companies and ABS backed by aircraft and related leases.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Aircraft Lessors and Aircraft Lease ABS – Global: Lessors can absorb effects of moderate exposure to Russian airlines; exposed aircraft ABS vulnerable
- Property & Casualty – Global: Tesla’s insurance venture puts incumbents under added pressure to innovate
- Property & Casualty Insurance – US: Insurers better match rate to risk as telematics gain consumer acceptance
Yaroslav Sovgyra, Melina Skouridou and Olivier Panis of the Banking team explain how the ongoing military conflict in Ukraine has affected the credit strength of global, Western European, Russian and Ukrainian banks.
Related content on Moodys.com (some content only available to registered users or subscribers):
- The fallout from Russia’s war in Ukraine will be felt by banks globally
- A few European banks face rising risk from exposure to Russia, Ukraine
Rating Action:
- Moody's downgrades the ratings of 39 Russian financial institutions; outlooks changed to negative
Insurance analysts Jasper Cooper and Christian Badorff discuss both direct and secondary risks global insurers are facing as the military conflict in Ukraine continues.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Insurance – Global: Russian invasion of Ukraine will drive investment volatility, more claims inflation
- Global – Cyber Risk: Russia-Ukraine tensions increase cyber risks across regions, asset classes
Analysts Megan Fox, Rokhaya Cisse and Mike Dion discuss cyber threats past and present, and steps regulators are taking to make sure financial institutions are prepared. Plus, Petr Paklin of the Banking team talks about the prospects for fast-growing all-digital banks, from market share to profits.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Funds & Asset Management – North America: SEC's proposed cybersecurity rules would strengthen investment industry's cyber resiliency
- Banking – Cross Region: Heightened focus on rising cybersecurity threats bolsters banking industry's preparedness
- P&C Insurance and Reinsurance – Global: Court ruling highlights risks of hidden cyber coverage in P&C policies
- Banking – Global: Rapid growth of challengers puts new verve into old banking systems
Moody’s banking analysts Constantinos Kypreos and Mik Kabeya join host Carolyn Henson to discuss prospects for banks in Africa’s five largest banking sectors after two difficult years.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Banking System Outlook – Nigeria: Economic rebound and recovering profitability shift the outlook to stable
- Banking System Outlook – South Africa: Negative outlook driven by challenging operating and macro conditions
- Banking System Outlook – Egypt: Solid financial metrics, robust economic growth drive a stable outlook
- Banking System Outlook – Morocco: Risk of lower government support capacity to the banks keeps our negative outlook
- Banking System Outlook – Kenya: Economic recovery, improving profitability drive stable outlook
Lev Dorf of the Banking team looks at why high use of dollars in many emerging markets poses rising risks for the country’s banks and where those risks are highest. Plus, Stephen Tu of the Financial Institutions group analyzes the Federal Reserve’s recent report and request for comment on the potential benefits of a US central bank digital currency.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Financial Institutions – North America: Fed’s US CBDC report highlights both the potential efficiencies of digital money and funding risks for banks
- Banks – China : Design of e-CNY will minimize risk of bank disintermediation in its initial phase
- Banking – Global: Central banks aim to limit disruption when designing retail digital currencies
- Financial Institutions – Global: Four forces reshaping financial landscape have potential to dislodge incumbents
- Banks - Emerging markets: High dollarization poses long-term risks for banks and for wider financial stability
Helena Kingsley-Tomkins and Paulette Truman of the Insurance team discuss how tech is transforming the insurance business, from connected devices that help prevent injuries and accidents to auto manufacturers entering insurance distribution. Plus, Sonny Hsu of the Banking team discusses the results of the Hong Kong Monetary Authority’s first climate stress test of banks, and Jasper Cooper of the Insurance team talks about the scope of insured losses from the recent Marshall wildfire in Colorado.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Banks – Hong Kong SAR, China: Hong Kong Monetary Authority's bank stress test on climate risk is credit positive
- Property & Casualty – United States: Homeowners and commercial property insurers face losses from Colorado wildfire
- Property & Casualty Insurance – US: Insurers better match rate to risk as telematics gain consumer acceptance
- Insurance – Global: Innovation critical for insurers as technology threatens their traditional earnings
Frank Yuen and Laura Bazer explain why the outlook for life insurers worldwide is less bleak than it was a year ago. Plus, Bruce Ballentine and Benjamin Serra discuss the strengths that help insulate global property and casualty (P&C) insurers from higher claims as economies reopen.
Related content on Moodys.com (some content only available to registered users or subscribers):
- P&C Insurance – Global – 2022 Outlook
- Life Insurance – Global – 2022 Outlook
- Life & Health Insurance – US – 2022 outlook stable, as US economic recovery solidifies
Banking analysts Michael Rohr and Donald Robertson explain how our outlook has improved for banks worldwide. Plus, Banking team analyst Svetlana Pavlova discusses how demographic trends in emerging markets are driving a divergence in banks’ growth and profitability prospects.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Banks – Global: 2022 outlook stable, reflecting sound capital and liquidity, with low credit losses (Slides)
- Banks – Emerging markets: Demographic trends will drive divergence of growth and profitability prospects
Dominic Simpson and Neal Epstein of the Asset Management team discuss prospects for global asset managers in 2022, as the global economic recovery and demand for alternative and ESG investments drive industry growth. Meanwhile, Ceres Lisboa, Ashraf Madani and Eugene Tarzimanov of the Banking team explore how emerging markets banks will benefit from G20 economies’ recovery, strong global demand for commodities and a rise in interest rates.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Asset Managers – Global: 2022 Outlook stable on economic recovery, strong demand
- Emerging market banks’ outlook is stable as credit conditions support financial fundamentals
Insurance analysts Dominic Simpson and Manoj Jethani discuss global insurers’ increasing investments in illiquid assets and why that’s mostly positive despite the risks. Plus, Fadi Massih of the Banking team talks about strengths and vulnerabilities in global banks’ management of cybersecurity risks.
Related content on Moodys.com (some content only available to registered users or subscribers):
- Cyber Risk - Global Banks of all sizes and credit strengths are increasing cybersecurity investment
- Life & Health Insurance – United Kingdom Growing illiquid asset exposure is more credit positive than negative
- Life Insurance – US: Illiquid assets rise, increasing returns while raising portfolio risk
- Insurance – Europe: Insurance CFOs ready for M&A amid cautious post pandemic optimism
- Benefits of insurers’ growing illiquid asset exposure balance additional risks
Mark Wasden of the Banking team and Chris Padgett of the Corporate Finance team explain how as US private credit grows, there is greater risk of widespread market disruption should the economy falter. Plus, Insurance team analyst Shachar Gonen explains why long-term care insurers are getting a brief reprieve, and Fadi Massih of the Banking team talks about the new Bitcoin ETF and why it is credit negative for Coinbase.
Guests: Shachar Gonen, Vice President, Senior Credit Officer – Financial Institutions Group, Moody’s Investors Service; Fadi Massih, Vice President, Senior Analyst – Financial Institutions Group, Moody’s Investors Service; Christina Padgett, Associate Managing Director – Corporate Finance Group, Moody’s Investors Service; Mark Wasden, Senior Vice President – Financial Institutions Group, Moody’s Investors Service
Hosts: Danielle Reed, Vice President, Senior Research Writer – Financial Institutions Group, Moody’s Investors Service; Michael Porta, Vice President, Senior Research Writer – Financial Institutions Group, Moody’s Investors Service
Related content on Moodys.com (some content only available to registered users or subscribers):
- Property & Casualty Insurance – Global: Proliferation of cyberattacks prompts re-evaluation of cyber insurance risk
- Auto Finance – Global: Sector can manage surge of residual value risk as electric vehicles come on line
Cybercrime has driven up demand for cyber insurance. But losses are on the rise, too, and some cyber events are uninsurable. How are insurers responding to higher losses, and what can be done about the kinds of risks that are too big for private insurers to cover? Plus, sales of alternative fuel vehicles worldwide are accelerating. What does it mean for the credit quality of auto finance captives, the companies that finance loans and leases on behalf of automakers?
Guests: Michael Dion, Vice President, Senior Analyst – Financial Institutions Group, Moody’s Investors Service; Inna Bodeck, Vice President, Senior Analyst – Financial Institutions Group, Moody’s Investors Service
Hosts: Danielle Reed, Vice President, Senior Research Writer – Financial Institutions Group, Moody’s Investors Service; Myles Neligan, Vice President, Senior Research Writer – Financial Institutions Group, Moody’s Investors Service
Related content on Moodys.com (some content only available to registered users or subscribers):
- Property & Casualty Insurance – Global: Proliferation of cyberattacks prompts re-evaluation of cyber insurance risk
- Auto Finance – Global: Sector can manage surge of residual value risk as electric vehicles come on line
Ahead of the COP 26 conference in Glasgow, analysts Lev Dorf, Brandan Holmes and Vanessa Robert explain why banks, insurance companies and asset managers are under pressure to reduce exposure to carbon-intensive industries. Indeed Moody's has estimated that G20 financial institutions are exposed to carbon transition risk to the tune of a staggering $22 trillion. However, financial institutions will need to play a vital role in financing the shift to net zero, and in this episode our team discuss what new areas of economic growth are emerging, amid the risks of decarbonization.
Inside this episode:
- Brandan Holmes on the drivers of decarbonization for insurance (begins at 2:38 mins)
- Lev Dorf on the biggest risks of decarbonization for banks (begins at 9:08 mins
- Lev Dorf discusses the economic opportunities for banks (begins at 13:17 mins)
Related Content:
- Financial firms face challenge of supporting corporate clients through the carbon transition (free to register)
- Infographic (free to register): Data on G20 financial institutions reveals $22 trillion of carbon transition
Peter Nerby, Olivier Panis and Shunsaku Sato explain how global systemically important banks are faring as the pandemic starts to recede. Dean Ungar discusses the implications for US health insurers should the Medicare hospital insurance trust fund run out of money. And David Yin tells us how a recent cryptocurrency ban in China is positive for financial institutions.
Inside this episode:
- Dean Ungar discusses the implications for US health insurers should the Medicare hospital insurance trust fund run out of money. (begins at 2:48 mins)
- David Yin tells us how a recent cryptocurrency ban in China is positive for financial institutions. (begins at 5:06 mins)
- Peter Nerby, Olivier Panis and Shunsaku Sato explain how global systemically important banks are faring as the pandemic starts to recede. (begins at 8:22 mins)
Related content:
- Banks – Global: Biggest banks retain competitive advantage, but stiff obstacles loom post pandemic - Most of the 30 large, global systemically important banks have maintained strong capitalization and liquidity, and their profitability is stronger than that of regional peers.
- Financial Institutions – North America: Looming Medicare trust fund depletion is credit negative for MA insurers - The trust fund's depletion would require reduced Medicare spending, which could mean lower payments for Medicare Advantage (MA).
- Financial Institutions – China: China's crackdown on virtual currencies is credit positive for financial institutions - Chinese authorities' crackdown on cryptocurrencies will support financial stability and back China's policy of reducing carbon emissions.
Stephen Tu, Melina Skouridou and Farooq Khan explain how four forces reshaping finance will likely reduce banks’ revenue from core activities and undermine their role as financial intermediaries. Plus, Alka Anbarasu explains why India’s banks will weather the stress from a COVID-19 resurgence, and Jasper Cooper gives an update on insured hurricane losses in the US.
Inside this episode:
- Alka Anbarasu explains why India’s banks will weather the stress from a COVID-19 resurgence. (begins at 1:55 mins)
- Jasper Cooper gives an update on insured hurricane losses in the US. (begins at 4:48 mins)
- Stephen Tu, Melina Skouridou and Farooq Khan explain how four forces reshaping finance will likely reduce banks’ revenue from core activities and undermine their role as financial intermediaries. (begins at 7:11 mins)
Related content:
- Banks – India: Resurgence of coronavirus raises asset risks but loan-loss buffers are sufficiently strong - A resurgence of coronavirus cases will lead to more problem loans. However, a sharp increase in problem loans is unlikely, and banks have sufficient buffers to absorb anticipated losses
- Property & Casualty Insurance– US Hurricane Ida's Northeast track adds billions to insurers' losses - Hurricane Ida's damages through New York, New Jersey and surrounding states will increase insurers' losses by billions of dollars.
- Reinsurance – Global: Weak La Niña and warm waters point to active 2021 Atlantic hurricane season - Above average sea surface temperatures, weaker trade winds and an enhanced West African monsoon result in more favorable conditions for hurricane formation and intensification this year.
- Financial Institutions – Global: Four forces reshaping financial landscape have potential to dislodge incumbents - We identify four forces of digitalization that have the potential to dislodge incumbents from dominant positions in financial markets.
- Banking – Global: Central banks aim to limit disruption when designing retail digital currencies - Banks would likely maintain their client-facing roles and would play a part in disseminating central bank digital currencies (CBDCs), but disintermediation risks will be heightened.
- Banks – Cross Region: Wide use of digital currencies in cross-border payments would be credit negative - Potential future wide acceptance of central bank digital currencies in cross-border payments and settlements will result in lower fees and commissions for banks.
Analyst Fadi Massih discusses the credit strengths and weaknesses of the crypto asset exchange.
Related content:
- Coinbase Global, Inc. Strong finances and market position offset by uncertain regulatory environment and fierce competitive conditions - Coinbase displays investment grade characteristics and financials that are offset by a challenging operating environment marked by uncertain regulatory framework and fierce competition.
The insurance group’s Helena Kingsley-Tomkins explains what’s driving the global reinsurance outlook shift to stable from negative. Plus, Young Kim tells us how evolving technology and rising fintech competition are transforming Korea’s insurance business.
Inside this episode:
- Young Kim tells us how evolving technology and rising fintech competition are transforming Korea’s insurance business. (begins at 1:45 mins)
- Helena Kingsley-Tomkins explains what’s driving the global reinsurance outlook shift to stable from negative. (begins at 9:35 mins)
Related content:
- Reinsurance – Global - Change to stable outlook reflects sound pricing, economic rebound - We have revised our outlook on the reinsurance sector to stable from negative, reflecting continued reinsurance price increases as the global economy recovers from the pandemic.
- Insurers – Korea - Stakes are rising in fintech adoption - Digital transformation will bring new business opportunities and operational efficiencies to Korean insurers but also heightens competition and adjustment risks they face.
As infections rise and overall vaccination rates remain low in Southeast Asian nations and India, loan performance will weaken as economic recoveries stall, although the effects will vary by country. However, government support and strong loss-absorbing buffers will support banks’ credit strength.
Related content:
- Property & Casualty – United States of America Losses from Dixie wildfire will hit California property and casualty insurers - Total insured losses from California wildfires are likely to exceed $1 billion for California homeowners insurers and commercial property insurers.
- Allianz SE US DOJ investigation into investment funds raises financial and reputational risk - DoJ investigation into investment activities of “Structured Alpha” funds raises the risk of a financial hit to the group and highlights governance challenges of complex groups.
- Aon, Willis Towers Watson Termination of Aon-Willis Towers Watson merger agreement poses governance challenge for WLTW - Aon and WLTW must reset their corporate strategies after terminating their proposed merger. The firms reduced their financial leverage and accumulated cash in preparation for the merger.
- Banks – ASEAN and India Asset risks will rise amid resurgences of coronavirus infections but credit strength will remain intact - Asset risks will rise for banks in the region amid a surge in coronavirus cases. However, the negative impact will be mitigated by continued policy support and strong loss-absorbing buffers.
Inside this episode:
Tae Jong Ok looks at Kakao Bank’s rapid rise from its social media origins to one of Korea’s biggest retail lenders. Plus, Christian Badorff and Melina Skouridou talk about the insurance impact of recent heavy floods in Germany, and the European Central Bank’s plan to pilot a digital euro.
Related content:
- Banks – Europe: Despite financial inclusion benefits, digital euro poses disintermediation risks to banks, a credit negative A digital euro would support innovation and financial inclusion, and could become an alternative to stablecoins, but would reduce banks' profitability and increase disintermediation risk.
- Insurance – Germany: German floods will hit P&C insurers' profit, highlighting climate change risk Devastating floods that hit parts of Germany on 14 and 15 July look set to cause insured losses of €4 billion to €5 billion, according to preliminary estimates.
- Banks – Korea: Big Tech success in banking highlights rising competition from virtual banks Big Tech success in banking highlights rising competition from virtual banks
Dean Ungar diagnoses the causes of US health insurers’ evolution over the past decade, and discusses the benefits and risks for the sector’s credit strength. Plus, Guy Combot and Atsi Sheth talk about recent changes in Italian bank governance and the broader credit implications of increased gender diversity.
Inside this episode:
- Guy Combot and Atsi Sheth talk about recent changes in Italian bank governance and the broader credit implications of increased gender diversity. (begins at 2:12 mins)
- Dean Ungar diagnoses the causes of US health insurers’ evolution over the past decade, and discusses the benefits and risks for the sector’s credit strength. (begins at 9:55 mins)
Related content:
- Banks – Italy: New “fit and proper” board criteria will reinforce Italian bank governance
- ESG – Global: Rising focus on gender inclusion highlights links to economic growth and credit quality
- Health Insurance – US: Sector’s evolution brings increased scale and diversification but also higher leverage
- Aetna Inc., Anthem, Centene Corp., Cigna Corp., Humana Inc., UnitedHealth Group : Vertical integration: short-term credit pain, long-term credit gain
- Health Insurance – US: Policy drive toward transformation of health insurance poses risks to profitability
Inside this episode:
Rajeev Bamra and Steve Tu speak with Carolyn Henson about why stablecoin growth has put traditional financial institutions and bank regulators on the defensive. Meanwhile, David Fanger explains why large US banks will be able to distribute more to shareholders this year, and Marina Cremonese discusses money market funds’ readiness for the transition away from LIBOR.
Related content:
- Banks – United States: Lower stress capital buffers allow many banks to increase capital distributions, a credit negative Compliance with regulatory buffer requirements and dividend caps supports US banks' capitalization.
- Money Market Funds – Cross Region: Money marketfunds are well positioned for IBOR phase-out MMFs face little disruption from the phase-out of IBOR reference rates. The sector is adopting alternatives, and will rapidly replace IBOR-linked portfolio assets.
- Technology & Innovation – Global: FAQ on the risks and opportunities of stablecoins Stablecoins, a digital currency, have many potential uses in banking and finance. They also pose risks that if left unaddressed could undermine financial stability and monetary sovereignty.
- Financial Institutions – Cross Region: G-7 call to step up dialogue on digital currencies is likely to hasten disintermediation of banks and payments providers Although digital currencies potentially will generate significant public benefits, a direct link between customers and public money risks disintermediating payment companies and banks.
Madhavi Bokil, Alexios Philippides and Laura Bazer explain how banks’ profit margins and US life insurers’ portfolio yields will benefit from rising inflation and a steeper yield curve in several advanced economies. Plus, Joe Pucella discusses the outlook for US commercial real estate lenders and Neal Epstein talks about Federal Reserve actions that helped money market funds stave off the risk of negative yields.
Inside this episode:
- Joe Pucella discusses the outlook for US commercial real estate lenders and Neal Epstein talks about Federal Reserve actions that helped money market funds stave off the risk of negative yields. (begins at 2:26 mins)
- Madhavi Bokil, Alexios Philippides and Laura Bazer explain how banks’ profit margins and US life insurers’ portfolio yields will benefit from rising inflation and a steeper yield curve in several advanced economies. (begins at 9:16 mins)
Related content:
- Commercial Real Estate Lenders – US: Change in outlook to stable from negative reflects recovering demand and asset values - We expect property demand and asset values to rise in many CRE sub-sectors over the next 12-18 months, and improved conditions will support the asset quality of lenders' loan portfolios.
- Money Market Funds – US: Fed's key repo rate increase throws lifeline to money market funds - The demand for high-quality short-term investments is outstripping supply, causing yields to hover near zero. Money market fund returns, and sponsor fees, will remain compressed.
- Banks – Global: Interest rate cycle shift bodes well for banks' profitability - Rising long-term interest rates are driving a gradual steepening in the yield curve in a number of countries. Provided the trend continues it will boost banks' margins in these jurisdictions
- Macroeconomics – US: US inflation indicators rise, but the increase is likely temporary - Inflation measures show acceleration in inflation due to base effects, one-off price increases and surging demand. We expect inflation to temporarily rise, eventually settling around 2%.
- Life Insurance – US: Life Insurers US: a little inflation is credit positive; a sizable spike would hurt - A modest rise in long-term interest rates, will give a boost to life insurers’ investment income and spread-based earnings
Manoj Jethani, Laura Bazer and Rory Callagy discuss the reasons for returning the outlooks for global and US life insurance and global asset management to stable from negative. Plus, James Eck updates us on Puerto Rico’s debt settlements.
Inside this episode:
- James Eck updates us on Puerto Rico’s debt settlements. (begins at 1:53 mins)
- Manoj Jethani, Laura Bazer and Rory Callagy discuss the reasons for returning the outlooks for global and US life insurance and global asset management to stable from negative. (begins at 7:03 mins)
Related content:
- Assured Guaranty Ltd. and MBIA Inc. Proposed Puerto R ico GO and revenue bond settlements clarify recovery rates for financial guarantors - With the significant majority of the guarantors’ Puerto Rico exposures now covered by settlement agreements, we have updated our exposure analysis for the financial guarantors.
- Life Insurance - US Strengthening US economy supports return to stable outlook - As the vaccine rollout progresses, the improving health and mobility of the US population will spur growth in insurance sales, revenue, and profits.
- Life Insurance – Cross Region Outlook revised to stable from negative - We have changed the outlook for the global life insurance sector to stable from negative for 2021.
- Asset Management – Global Outlook changes to stable on higher financial markets, stronger flows - The return to stable reflects a clear improvement in the industry's operating conditions.
Alberto Postigo and Alka Anbarasu discuss the threat of climate change to banks’ asset quality. Plus, Megan Fox and Steve Tu talk about the effects on banks and asset managers of the Biden administration’s new executive order on climate-related financial risk, and Sid Ghosh tells us whether businesses around the world can get insurance coverage for disrupted operations during the pandemic.
Inside this episode:
- Megan Fox and Steve Tu talk about the effects on banks and asset managers of the Biden administration’s new executive order on climate-related financial risk, and Sid Ghosh tells us whether businesses around the world can get insurance coverage for disrupted operations during the pandemic. (begins at 2:37)
- Alberto Postigo and Alka Anbarasu discuss the threat of climate change to banks’ asset quality. (begins at 8:06)
Related content:
- Insurance – Global: As coronavirus claims slow, risk to profitability recedes - Global coronavirus (re)insured losses will be contained within earnings as losses slow in 2021.
- Property & Casualty – US: Coronavirus litigation favors US insurers; legislative changes have mixed implications - US courts have largely sided with (re)insurers in litigation related to business interruption insurance, though a large number of cases are still pending.
- Banks – US: Biden order aims for coordinated assessment and mitigation of banks' climate-related financial risks, a credit positive - The oversight is credit positive for banks because it will contain their financial risk from climate-related and environmental risks.
- Asset Management – US: Biden executive order on climate-related financial risk benefits ESG focused asset managers - The executive order clears the way to remove restrictions the prior administration had placed on investing in ESG, which has been a key growth area for asset managers.
- Banking – Global: Climate change to force further business model transformation for ban - Climate change creates operational and strategic challenges for banks globally as governments transition towards low-carbon economic models, and as physical climate risks become more acute.
- Banks – Asia-Pacific: Climate risks are growing, with large, diversified banks better positioned to cope - Large, diversified banks are inherently less susceptible to climate risks from a single location or industry. Also, they have been proactive in devising strategies to deal with such risks.
Vanessa Robert and Marina Cremonese of the Funds and Asset Management team discuss new money market fund regulations proposed in the US and EU after a material flight to quality shook short-term credit markets last year. Plus, Svetlana Pavolva of the Banking team explains the significant social risks facing banks in Commonwealth of Independent States countries.
Inside this episode:
- Svetlana Pavolva of the Banking team explains the significant social risks facing banks in Commonwealth of Independent States countries. (begins at 3:26)
- Vanessa Robert and Marina Cremonese of the Funds and Asset Management team discuss new money market fund regulations proposed in the US and EU after a material flight to quality shook short-term credit markets last year. (begins at 10:31)
Related content:
- Banks – Commonwealth of Independent States: “Civil unrest and demographic changes pose substantial social risks - Banks in the region are facing substantial social risks stemming from demographic and societal trends, as well as customer relations.
- Money Market Funds – Cross Region: Money market funds face more rule changes after coronavirus turmoil - Regulators intend to review MMF rules this year after the financial market impact of the coronavirus crisis in March 2020 raised concerns about the sector's systemic risk.
- Money Market Funds – US: Funds face bear market on flight to quality - Money market funds face two main risks: uneconomic yields on Treasury and government funds and sharp NAV declines for credit-sensitive funds.
Gersan Zurita of the Credit Strategy and Research team and Semyon Isakov of the Banking team discuss rising inflation in some key emerging markets. Plus, Felipe Carvallo and Mik Kabeya of the Banking team talk about slipping government support for banks in economies that are heavily dependent on oil.
Inside this episode:
- Felipe Carvallo and Mik Kabeya of the Banking team talk about slipping government support for banks in economies that are heavily dependent on oil. (begins at 2:04)
- Gersan Zurita of the Credit Strategy and Research team and Semyon Isakov of the Banking team discuss rising inflation in some key emerging markets. (begins at 6:48)
Related content:
- Banking System Outlook Update – Mexico: Negative outlook on prolonged recovery and deteriorating government support - We maintain our negative outlook for the Mexican banking system in line with our expectation that less predictable policy response will weigh on economic recovery and government support.
- Banking System Outlook Update - Saudi Arabia: Negative outlook reflects asset quality pressure and weakening government support - Our outlook for the Saudi banking system is negative. The outlook reflects our view of how the banks' creditworthiness will evolve over the next 12 to 18 months.
- Banks – Russia: Climbing inflation will boost large bank dominance amid structural shift in funding - Rising inflation has turned real yields on deposits negative, hastening the movement of savings out of term deposits, which will boost large banks dominance.
- Macroeconomics – Latin America: Pace of inflation quickens but long-term implications will depend on any sustained acceleration - Basic commodity prices have risen by 50% on average over the last 12 months across Latin America, with differing drivers and effects by country.
Bob Garofalo and Laura Bazer of the Insurance team explain the drivers behind all the M&A transactions in the life insurance industry, and what they mean for credit when the buyers are private-equity firms. Plus, Donald Robertson of the Banking team and Jasper Cooper of the Insurance team answer questions about Archegos and the recent cyber attack on insurer CNA.
Inside this episode:
- Donald Robertson of the Banking team and Jasper Cooper of the Insurance team answer questions about Archegos and the recent cyber attack on insurer CNA (begins at 2:11)
- Bob Garofalo and Laura Bazer of the Insurance team explain the drivers behind all the M&A transactions in the life insurance industry, and what they mean for credit when the buyers are private-equity firms (begins at 6:39)
Related content:
- Banks – Global: Archegos default highlights credit-negative risk opacity in banks’ prime brokerage activities - Credit Suisse and Nomura reported the possibility of incurring significant losses associated with a hedge fund default
- CNA Financial Corporation: Cybersecurity attack disrupts systems including webpage - The cyberattack could increase CNA's expenses and its reputational and regulatory risks, but its profitability and solid capital position mitigate risks. Its ratings are unchanged.
- Life Insurance – US: Companies transform business models via M&A, prepare for post-COVID world - Disruptions in life insurers' business models causing the sector to focus on what matters
- Life Insurance – US: PE-driven M&A: good for life insurance sellers, less so for remaining policyholders - Robust PE capital markets provide strategic solutions for sellers, but policyholders and creditors can be exposed to greater financial risk under new PE owner.
Fresh off the Asset Management team’s virtual conference, Rory Callagy highlights how asset managers are finding growth – sometimes through acquisitions – in ESG, alternative investments and software solutions. Plus Antonello Aquino of the Banking team discusses the growing environmental risks African banks confront.
Inside this episode:
- Rory Callagy highlights how asset managers are finding growth – sometimes through acquisitions – in ESG, alternative investments and software solutions. (begins at 2:17)
- Antonello Aquino of the Banking team discusses the growing environmental risks African banks confront. (begins at 8:11)
Related content:
- Asset Management Week - Available On-Demand - Explore highlights of this 4-day event covering topics such as ESG and its impact on credit, active asset management, rise of M&A, and much more.
- Moody's Asset Management Week – Recap: Asset managers scale up to gain edge in ESG, technology, alternative investments - In a fragmented, growth-challenged industry, scale is helping firms obtain technology, expertise and products – including ESG and alternatives – that give them a competitive advantage.
- Banks – Africa: Banks begin to take stock of intensifying environmental threats - African banks face climate change risk through large loans extended to environmentally sensitive sectors and through the government bonds they hold on their balance sheets
In a special episode of our Focus on Finance podcast series, Stephen Long, Louise Lundberg and Eugene Tarzimanov of the Banking team join host Carolyn Henson to discuss the prospects for banks around the globe as government economic support measures start to unwind and banks brace for a substantial rise in loan defaults. Many economies are set to rebound this year but banks must factor in continuing uncertainty over the future course of the pandemic.
Related content:
- Banking System Outlook - South Africa: Weak economy, deteriorating loan quality and profitability drive our negative outlook
- Banking System Outlook Update – Mexico: Negative outlook on prolonged recovery and deteriorating government support
- Banking System Outlook Update – Japan: Long-running structural challenges in a weak economy drive negative outlook
- Banking System Outlook Update – India: Potential weakening of government ability to provide support drives negative outlook
- Banking System Outlook Update – Germany: Outlook for German banks remains negative
With cyber risk on the rise, Lesley Ritter of the Cyber Risk team and Megan Fox, Michael Dion and Rokhaya Cisse of the Financial Institutions team discuss our survey and findings on banks’, insurers’ and asset managers’ preparedness for a cyberattack.
Related content:
- Cyber Risk – Global: 2021 Outlook – Cyber vulnerabilities in software supply chains, rising cost of ransomware will be key risks
- Cross-Sector – Global: Credit implications of cyber risk will hinge on business disruptions, reputational effects
- Cyber Risk – Global: Sunburst attack on public and private entities raises credit risks as extent of breach unfolds
- Banks – North America: Cybersecurity strength rests on governance and prevention
- Insurers, Insurance Brokers and Asset Managers - Global: Survey signals cybersecurity strength, with some differences across sectors, regions.
- Insurance – US: Surge in ransomware claims drives cyber insurance prices higher
- P&C Insurance — Global: Battling hidden cyber exposures, insurers position for growing opportunity
Brandan Holmes of the Insurance team and James Leaton of the ESG team discuss why global regulators are zeroing in on financial sector climate risks. Plus, the Asset Management team’s Steve Tu talks about how and why US ESG investments are surging in popularity, and Francisco Uriostegui discusses the benefits and challenges for Mexican pension funds of incorporating ESG screening into investment decisions.
Inside the episode:
- Brandan Holmes of the Insurance team and James Leaton of the ESG team discuss why global regulators are zeroing in on financial sector climate risks. (begins at)
- Steve Tu of the Asset Management team talks about how and why US ESG investments are surging in popularity, and Francisco Uriostegui discusses the benefits and challenges for Mexican pension funds of incorporating ESG screening into investment decisions. (begins at)
Asset Management Week - Register today!
Join Moody’s the week of March 22nd for 4 days of in-depth discussion as we look to answer the question – How are asset managers allocating their capital and efforts to invest in the future growth and competitiveness?
Related content:
- ESG – Global: 2021 outlook – Stimulus, transparency and policy alignment to amplify ESG trend - As the global economy recovers from the coronavirus pandemic, ESG issues will assume greater importance in the actions of policymakers, regulators, investors and corporate decisionmakers.
- Insurance – Global: Global insurance regulators increase focus on climate risk - Regulators around the world are encouraging the insurance industry to improve its understanding of, and ability to manage, the financial risks related to climate change.
- Allianz, AXA, Swiss Re, Munich Re, Zurich: Retreat from coal reduces liability and stranded asset risk, a credit positive - Major European (re)insurers are limiting their investment and underwriting exposure to coal. This protects them against climate change liability risk, and the risk of asset stranding.
- Financial Institutions – Europe: BoE climate change stress tests will reinforce risk management for banks and insurers - Climate change stress tests are credit positive as they will help banks and insurers understand the consequences of climate change for their business, and support their risk management.
- Insurance – Global: The impact of environmental, social and governance risks on insurance ratings - In this report we explore the environmental, social and governance risks that insurers face, and explain how we incorporate them into our insurance ratings.
- Funds & Asset Management – US: ESG investment outperformance overcomes investor hesitancy, a key barrier to growth - Environmental, social and governance themed investments have become one of the best performing investment categories in recent years, paving the way for continued growth of this strategy.
- Asset Managers – Global: Beyond passive, ESG investing is the next growth frontier for asset managers - ESG is a unique growth opportunity for asset managers because it promises to deliver value in a more holistic manner, getting beyond investment outperformance which is a zero sum game.
- Funds & Asset Management – Mexico: ESG factors improve risk analysis, but adoption will take time with market limitations - ESG investing could provide useful framework to pension asset managers, but significant changes will be gradual given fewer investment options in the local market and legacy portfolios.
Donald Robertson and Fadi Massih of the Securities and Exchanges team size up the implications that the recent social media-powered short squeeze has for US retail brokers, market makers, clearinghouses and exchanges. Plus, Swen Metzler spotlights German banks’ pressing need to rein in costs, and Alka Anbarasu tells us which Indian banks will win the race to go digital.
Inside this episode:
- Swen Metzler spotlights German banks’ pressing need to rein in costs, and Alka Anbarasu tells us which Indian banks will win the race to go digital (begins at 3:01).
- Donald Robertson and Fadi Massih of the Securities and Exchanges team size up the implications that the recent social media-powered short squeeze has for US retail brokers, market makers, clearinghouses and exchanges (begins at 12:04).
Related content:
- Banks – Germany: Large cost cuts are needed to stay profitable - German banks' high costs make them among the least profitable in Europe. That will need to change in face of further declining revenues.
- Banks – India: SBI, large private sector banks stand to gain from digitalization accelerated by pandemic - As social distancing measures boost demand for digital financial services, large banks capable of accelerating digitalization are well positioned to benefit.
- Securities & Exchanges – US: Retail trader short-squeeze has substantial market infrastructure implications - Recent market events and volatility have opened the prospect that authorities may propose changes to the US financial market infrastructure. We explore some possible proposals.
A dwindling number of workers in developed economies will support a growing share of retirees, and growth and profitability are declining for banks, insurers and asset managers. Young Kim of the Insurance team and Tomoya Suzuki of the Banking team examine how South Korea’s insurers and Japan’s regional banks are turning demographics into opportunities, while Dean Ungar of the Asset Management team zeroes in on US asset managers’ future.
Inside this episode:
- Young Kim of the Insurance team and Tomoya Suzuki of the Banking team examine how South Korea’s insurers and Japan’s regional banks are turning demographics into opportunities. (begins at 2:35)
- Dean Ungar of the Asset Management team zeroes in on US asset managers’ future. (begins at 11:35)
Related content:
- Insurers – South Korea: Aging population a key challenge despite some opportunities - Insurers face rising risks from a growing weakness in mainstream products, along with higher competition in longevity products, which could weaken their underwriting discipline.
- Regional banks – Japan: Population aging and coronavirus-driven digitization can create opportunities - Banks can benefit from growing demand for services related to population aging, while increasing adoption of digital banking services will enable banks to cut costs by using technology.
- Sovereigns – Global: Ageing-related credit pressure to rise in 2030s in advanced economies- Absent measures that raise productivity growth or reduce spending, the fastest-ageing economies face a weakening in economic and fiscal strength.
- Asset Managers — US: Demographic trends point to future struggle to grow assets under management - Working-age population growth is slowing dramatically, the elderly population will grow significantly and live longer, and younger generations will be less wealthy.
Lan Wang of the Banking team and Lillian Li of the Credit Strategy & Research team discuss why China’s move to open up its domestic financial markets to foreign securities firms potentially benefits all parties, despite operational hurdles. Plus, Marina Cremonese of the Asset Management team joins Lan to talk about the future for asset managers seeking to grow their businesses in China.
Inside this episode:
- Lan Wang of the Banking team and Lillian Li of the Credit Strategy & Research team discuss why China’s move to open up its domestic financial markets to foreign securities firms potentially benefits all parties, despite operational hurdles. (begins at 1:48)
- Marina Cremonese of the Asset Management team joins Lan to talk about the future for asset managers seeking to grow their businesses in China. (begins at 9:54)
Related content:
- Securities & Exchanges – China: Market opening to foreign companies is good news, but constraints remain - Removal of foreign ownership limit is a significant move for industry liberalization and will create new opportunities for foreign firms, but there remains substantial hurdles for entrants.
- Credit Conditions – Global: COVID-19 will quicken shift to tripolar economy, with widespread negative - The continued move toward a tripolar economy with the US, China and the EU as its pillars will have credit ramifications for a broad range of industries and countries.
- Asset Management – Cross Region: Foreign asset managers will need to play long game to succeed in China - Foreign asset managers entering the Chinese market will need to invest significantly and accept that it will take time to achieve profitable growth.
Donald Robertson and Ana Arsov of the Banking team explain how the lessons global investment banks learned from the financial crisis better prepared them to withstand coronavirus stresses, and how strong capital markets revenue buffered the large loan-loss provisions they booked during 2020. Plus, Mark Wasden and Bruno Baretta of the Banking team explore how coronavirus effects are driving the negative outlook for most global finance companies.
Inside this episode:
- Mark Wasden and Bruno Baretta of the Banking team explore how coronavirus effects are driving the negative outlook for most global finance companies (begins at 2:13).
- Donald Robertson and Ana Arsov of the Banking team explain how the lessons global investment banks learned from the financial crisis better prepared them to withstand coronavirus stresses, and how strong capital markets revenue buffered the large loan-loss provisions they booked during 2020 (begins at 9:19).
Related content:
- Finance Companies - Global: 2021 outlook is negative (Slides) - Our outlook for finance companies globally is negative to reflect ongoing effects of the coronavirus pandemic, though several subsectors have been more resilient through adverse conditions.
- Asset Management Companies (AMCs) – China: AMCs' participation in bank restructuring reinforces their policy role but weakens standalone credit profile - Aside from acquiring and disposing bad loans, AMCs are performing a growing range of functions to facilitate the restructuring of distressed banks.
- Global Investment Banks: 2021 outlook stable as diverse businesses, strong capital, liquidity and funding ease pandemic-related asset quality pressure (Slides) - Diverse, profitable businesses along with strengthened capital and liquidity will shield the global investment banks against pandemic-related asset quality deterioration in 2021.
Laura Bazer and Dominic Simpson of the Insurance team and Greg Bauer and Sophia Lee of the Banking team discuss how a fragile economic recovery, low interest rates and uncertainty about renewal of government support measures are among the drivers of negative outlooks for global banks, life insurers and reinsurers (begins at 1:55). P&C insurers will benefit in the difficult operating environment from lower auto claims, strong capital, and the mandatory nature of certain products.
Inside this episode:
- Life insurance, reinsurance and P&C insurance 2021 Outlook (begins at 1:55)
- Banking 2021 Outlook (begins at 11:20)
Related content:
- Banks – Global 2021 Outlook - Global banks entered the coronavirus crisis with strong balance sheets but still face substantial risk in 2021. Ongoing low interest rates, digitalization and ESG compliance will continue to
- Reinsurance – Global 2021 Outlook - Uncertainty around coronavirus-related losses, along with low interest rates, shrinking reserve releases and more expensive retrocessional coverage will weaken reinsurers’ profitability.
- P&C Insurance – Global 2021 Outlook - 2021 Outlook stable on strong capital, commercial prices (Slides)
- Life Insurance – Global 2021 Outlook - Ultralow interest rates underpin our negative outlook; Covid-19 mortality and related economic fallout have hurt profitability and investments less than we expected
Rokhaya Cisse and Marina Cremonese of the Asset Management team explore why the pandemic fallout has dimmed revenue prospects and made growth harder for asset managers. Plus, Celina Vansetti-Hutchins looks at how a difficult operating environment and elevated asset risk are driving our negative outlook for financial institutions in emerging markets.
Inside this episode:
- Celina Vansetti-Hutchins looks at how a difficult operating environment and elevated asset risk are driving our negative outlook for financial institutions in emerging markets.(begins at 1:58)
- Rokhaya Cisse and Marina Cremonese of the Asset Management team explore why the pandemic fallout has dimmed revenue prospects and made growth harder for asset managers. (begins at 8:35)
Related content:
- Asset Management - Global: 2021 outlook negative as coronavirus crisis intensifies long-term headwinds (Slides) - Increased market volatility, an uneven economic recovery and competitive environment in the ongoing pandemic will likely weaken global asset managers’ revenue and hamper growth amid an increased cost of doing business as regulators intensify their review of asset managers’ products and activities.
- Financial Institutions – Emerging Markets: 2021 outlook negative as operating environments heal from pandemic and asset risk remains a wild card - Banks face challenging conditions and looming asset risk, while pressures on insurers’ capital are rising despite lockdown-driven one-off gains from fewer claims having boosted profitability.
Edoardo Calandro, David Fanger and Daniel Yu of the Banking team zero in on the COVID-19 pandemic’s effects on bank loans in the UK, US and Australia. Plus, Shachar Gonen of the Insurance team and Keith Banhazl of the Structured Finance team look at how much the slowdown in commercial real estate will weaken US life insurers’ CMBS holdings.
Inside this episode:
- Shachar Gonen of the Insurance team and Keith Banhazl of the Structured Finance team look at how much the slowdown in commercial real estate will weaken US life insurers’ CMBS holdings. (begins at 2:10)
- Edoardo Calandro, David Fanger and Daniel Yu of the Banking team zero in on the COVID-19 pandemic’s effects on bank loans in the UK, US and Australia. (begins at 7:48)
Related content:
- Life Insurance – US: Credit deterioration picks up in CMBS holdings but capital is resilient. CMBS remains a moderate component in US life insurers’ investment portfolios. The industry’s CMBS credit quality remains strong and capital levels are robust to absorb deterioration.
- CMBS-US: Moody's DQT - New delinquencies suppressed by temporary relief of forbearance and loan modification agreements. Moody’s CMBS conduit loan Delinquency Tracker (DQT) decreased to 7.51% in September 2020, as forbearance and other loan modifications provide loan relief.
- Financial Institutions — Banks – Cross Region: Pandemic induced credit losses set to rise. The coronavirus pandemic has pushed many countries into recession, leading to a deterioration in credit conditions that will trigger a significant increase in bank loan losses.
Inside this episode:
Banks will benefit from an increased customer base as accelerated digitalization makes financial services available to unbanked populations in emerging markets. But traditional banks face competition as big tech firms impinge on payment services and central banks explore creating their own digital currencies as a defensive move.
Related content:
- Banks – Emerging Markets: Technology is deepening financial inclusion
- Banks – China, Europe, and US: Digitalization is breaking banks' historical dominance in retail payments
- Banking – Global: Central bank digital currencies would compound digital disruption for banks
Original publish date: October 21, 2020
Inside this episode:
- Simon Ainsworth and James Eck of the Insurance team discuss the latest developments in global insurers’ efforts to assess and manage climate risk. (begins at 2:27)
- Stefan Kahandaliyanage of the Insurance team lays out the risks US health insurers face from a policy drive toward a public insurance option. (begins at 10:04)
Related content:
- Health Insurance – US: Policy drive toward transformation of health insurance poses risks to profitability - Proposals to create a public health insurance option would likely reduce earnings at our rated companies to varying degrees, with more expansive options having a larger impact.
- P&C Insurance and Reinsurance – Global: Climate change risks outweigh opportunities for P&C (re)insurers - P&C (re)insurers have significant exposure to the economic consequences of climate change, including risks arising from catastrophe exposures, claims on liability policies, and investment
- Insurance – Europe: Insurers increasingly engaged as ESG risks and opportunities come into focus - European insurers see environmental, social and governance (ESG) issues as an area of strategic focus, and expect them to have a moderately adverse impact on underwriting risk.
- Financial Institutions – Europe: BoE climate change stress tests will reinforce risk management for banks and insurers - Climate change stress tests are credit positive as they will help banks and insurers understand the consequences of climate change for their business, and support their risk management.
- Allianz, AXA, Swiss Re, Munich Re, Zurich: Retreat from coal reduces liability and stranded asset risk, a credit positive - Major European (re)insurers are limiting their investment and underwriting exposure to coal. This protects them against climate change liability risk, and the risk of asset stranding.
- Moody’s Banking Series - The Series digital program is free and offers exclusive interviews, thematic panel discussions and regional deep dives.
Original publish date: October 7, 2020
Inside this episode:
- Olivier Panis of the Banking team and Stefan Kahandaliyanage of the Asset Management team update financial institutions’ readiness for the transition away from Libor in 2021. (begins at 1:34)
- As policy rates continue to decline globally, Banking team member Laurie Mayers examines the effect on UK banks, while Shunsaku Sato does so for Japanese banks and Farooq Khan for Brazilian banks. (begins at 7:34)
Related content:
- Financial Institutions – Global: IBOR phaseout 15 months away, but hurdles could stretch beyond finish line - We surveyed 85 banks and non-bank financial institutions to gauge their preparedness for the transition to overnight Alternative Reference Rates from IBOR-linked contracts.
- Banks – Japan: Low rates and slow cost-cutting amid excess capacity will keep profitability weak - Banks in Japan will continue to face ultralow rates as extremely accommodative monetary policy remains in place, while having difficulty in cutting costs due to structural rigidity.
- Banks – United Kingdom: Low for longer rates will exacerbate margin pressure for UK banks - With rates likely to stay low for longer than expected as a result of the coronavirus crisis, we expect pressure on UK banks' margins to intensify.
- Banks – Brazil: Net interest margins will be tested as rates stay low for longer - Brazilian banks will face margin pressure from higher funding costs and increased competition, despite a positively sloped yield curve amid record low rates and recovering economy .
- Moody’s Banking Series - The Series digital program is free and offers exclusive interviews, thematic panel discussions and regional deep dives.
Original publish date: September 23, 2020
Inside this episode:
- Peter Nerby and Michael Rohr of the Banking team discuss how global systemically important banks entered the coronavirus crisis with healthier balance sheets, capital and liquidity than before the last global downturn (begins at 8:14).
- Ceres Lisboa explains how Latin American banks risk a sharp deterioration in asset quality as payment deferrals and government aid lapse (begins at 2:05).
Related content:
- Banks – Latin America: Coronavirus resets economies at lower base driving asset risks in 2020 and beyond - Banks face uneven effects of pandemic as contagion continues. Deferrals and government aid help but asset risks are rising. Reserve buffers are only adequate to absorb a mild loss scenario.
- Banks – Global: Biggest banks are better set to withstand COVID-19 stress than banks as a whole - The 30 global systemically important banks (G-SIBs) are better prepared to withstand the adverse effects of the COVID-19 pandemic than the universe of Moody’s-rated banks as a whole.
- BAC, CS, JPM, MS and UBS: Stable wealth-management arms of largest Swiss and US banks are a credit positive offset to COVID-19 disruption - We compare the wealth management divisions of the five largest global investment banks (BAC, CS, JPM, MS and UBS) rated by us and assess their prospects for the future.
- Moody’s Banking Series - The Series digital program is free and offers exclusive interviews, thematic panel discussions and regional deep dives.
Original publish date: September 9, 2020
Inside this episode:
- James Eck explains why threats to profitability turned the outlook on global reinsurers negative. (begins at 1:20)
- Laura Bazer tells us how the coronavirus shock jolted global life insurers into a new, more digital future. (begins at 7:04)
Related content:
- Reinsurance – Global Outlook turns negative as profitability weakens, despite higher pricing - Our negative outlook on the reinsurance sector reflects uncertainty around coronavirus-related losses, as well as persistent low interest rates and lower reserve releases.
- Life Insurance – Global: Life insurers go virtual, tech sorts winners from losers post coronavirus - Technology will be a key differentiator of life insurers in the future.
- Moody’s Banking Series - The Series digital program is free and offers exclusive interviews, thematic panel discussions and regional deep dives.
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Original publish date: August 26, 2020
Inside this episode:
- Antonello Aquino from the Insurance team explains why European insurers are giving back premiums now and might have to cover more claims later because of the pandemic. (begins at 1:59)
- Banking team analyst Alka Anbarasu details the government support India’s public-sector banks will need to maintain capital strength as credit costs rise in COVID-19’s wake. (begins at 9:09)
Related content:
- Coronavirus fallout will leave banks with capital shortages again- As the coronavirus outbreak hurts India's economy growth, sharp increases in credit costs will erode banks' profit. Consequently, banks will face large capital shortfalls again.
- Insurers face increasing social and legal risks arising from coronavirus- European non-life insurers are under political, social and legal pressure to surrender one-off profits generated during the coronavirus crisis or pay additional coronavirus-related claims.
- Moody’s Banking Series - The Series digital program is free and offers exclusive interviews, thematic panel discussions and regional deep dives.
Original publish date: August 12, 2020
Inside this episode:
- Alessandro Roccati from the banking team explains how coronavirus-driven demand for contactless digital financial services, along with remote work, are raising the cyber threat to banks. (begins at 8:21)
- Steve Tu of the asset management team looks at how the latest US government intervention in money markets could signal an eventual phaseout of institutional prime funds. (begins at 1:45)
Related content:
- Money Market Funds – US: Most recent intervention could mark a turning point for institutional prime funds - Large sponsors are now exiting the product rather than risking having to support theirinstitutional prime funds.
- Cyber risk rises as coronavirus drives increased digital banking and remote work - Social distancing has increased digital banking and remote work by bank employees, leading to increased cyber risk. Most banks have developed cyber risk awareness and mitigation measures.
- Moody’s Banking Series - The Series digital program is free and offers exclusive interviews, thematic panel discussions and regional deep dives.