Singapore among first countries to recover from pandemic effects: S&P Global Ratings on banking systems

jurisdictions banks pandemic

Singapore will be an early exiter of the pandemic effects of COVID-19 on its banking system according to S&P Global Ratings. It has so far demonstrated resilience to the economic effects of the pandemic. Risk assessment on its banking system has remained unchanged and the pandemic has limited effect on its financial institutions.

According to the S&P Global Ratings, Singapore will be among the first countries to exit the effect of the pandemic – by end of 2022.

The pandemic and the oil price shock of 2020 have exacted a heavy toll on banks.

of banking jurisdictions to pre- levels will be slow, uncertain, and highly variable across sectors and geographies, S&P Ratings said.

S&P analysed 20 of the largest banking systems globally in its report.

“We do not expect the world’s largest banking sectors, including more than half of G20’s, to recover to pre- levels until 2023 or beyond,” it said.

The 20 banking jurisdictions are segmented into three groups: early-exiters, mid-exiters, and late-exiters.

Many prominent banking jurisdictions will only recover in 2023 or beyond.

They include the US, UK, France, Germany, Spain, Italy, Japan, Australia, Brazil, Indonesia, and Russia. These are the mid-exiters.

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Among the banking jurisdictions likely to recover first – by end of 2022 – are China, Canada, Singapore, Hong Kong, South Korea, and Saudi Arabia.

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These are the early-exiters. They have so far demonstrated the greatest resilience to the economic effects of COVID-19.

They will exit the effects of the pandemic the quickest.

They are in general coping more satisfactorily with the huge slump in demand triggered by the pandemic.

So far, the pandemic has no effect on the BICRA (Banking Industry Country Risk Assessment) of these jurisdictions.

Likewise, changes in ratings of financial institutions have been minimal.

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