WASHINGTON: The International Monetary Fund warned that an escalation of tensions between Russia and Ukraine would raise the risks for banks exposed to those countries. Hit by US and European Union economic sanctions against Moscow, Russian businesses in particular could see financing and revenue dry up, pushing them to fall behind in servicing debts.
“As Russian and Ukrainian credit quality deteriorates, banks with credit exposures will be faced with increased risks of default,” the IMF said in a report on financial spillovers in the global economy.
Austrian banks are the most exposed relative to their bank asset size. And any problems affecting them could spread through credit channels in the rest of emerging Europe, the report said.
In addition, French, Italian and Swedish banks have relatively larger exposures compared with banks in other advanced economies, said the report, which did not identify any bank by name.
AFP
