Ukraine-The impact on French banks deemed manageable by Fitch | Photo credits: Arnaud Pouilleux for Les Echos
March 24 (Reuters) – The impact of Russia’s invasion of Ukraine on French banks is “manageable” and will come less from their direct exposure to these two countries than from the economic consequences of the conflict, the agency believes. of Fitch Ratings in a study released Thursday.
“The potential direct impacts are absorbable for Societe Generale, which is the most directly exposed French bank, and therefore unlikely to lead to a change in rating”, indicates the financial rating agency.
Fitch Ratings, however, anticipates negative fallout on the French economy, including lower GDP growth, energy price inflation and supply chain disruptions.
“We expect ripple effects on economic growth in the euro zone, on business volumes and an aggravation of risks linked to the quality of assets”, specifies the agency.
Fitch Ratings emphasizes that the outlook for French banks on their issuer default ratings is stable, and that they benefit from a favorable environment following the economic recovery.
“French banks have emerged from the COVID-19 pandemic by improving their profitability, the quality of their assets, and by strengthening their capital reserves”, specifies the rating agency.
“Recent events are adding to the pressure on revenues that we were already expecting for French banks in 2022,” adds Fitch, which has revised down its forecast for economic growth in France and the euro zone, reduced to 3% this year. year against 3.7% previously.
The rating agency stresses, however, that the partial reversal of provisions and the government’s support for companies could limit the impact on profits and the deterioration in asset quality. (Report Augustin Turpin, edited by Jean-Michel Bélot)