Ireland banking system outlook remains negative, says Moody's
The outlook is unchanged since 2008 and principally reflects the rating agency's view that the Irish banking system has not yet fully stabilised, despite:
1. the removal of large real-estate portfolios from the banks' balance sheets into the National Asset Management Agency (NAMA) in 2010 and 2011
2. the marginally positive, but still weak, GDP growth that Moody's expects to continue in 2013.
The system outlook also captures Moody's view that Irish banks will remain under pressure over the next 12 to 18 months due to:
* ongoing asset-quality deterioration, more recently stemming from poor residential mortgage loan performance
* their continued, albeit reducing, dependence on central bank funding
* weak profitability and internal capital generation
The new report - Banking System Outlook: Ireland - is available on www.moodys.com.
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