COVID-19: Fitch Downgrades Issuer Default Ratings of 20% of ASEAN Banks in Its Portfolio

Fitch Ratings (Fitch) has lowered 20% of Asean Bank's issuer default ratings (IDRs) under its portfolio since March 2020, following a substantial increase in risks amongst financial institutions due to the economic volatility induced through COVID-19.

Fitch stated that it has affirmed around 80% of its ASEAN banks portfolio during the aforesaid period with 41% of the portfolio subject to downward outlook revisions. The rating agency added that it now has about 30% of its ASEAN banks either on “negative outlook” or “rating watch negative”. Fitch also noted that almost two-thirds of the ratings evaluated were propelled by institutional support from foreign parents-particularly in Indonesia-or the re...