Moody's Investors Service said on July 24 that it expects Slovakia's GDP to fall over this year after seeing the country's economic outlook sharply worsen within a short period of time, the TASR newswire reported, with the GDP decline affecting both corporations and households.
“Even though Slovak banks were not hit by the first phase of the ongoing global economic crisis due to their limited exposure to crisis-distressed assets and to the bankrupt financial houses, the pressure on banks is building as the crisis spills over into the real economy (goods and services rather than the paper, financial economy),” said Gabriel Kadaši, chief analyst with Moody's, to TASR.
Kadaši pointed out that Moody's in May had downgraded its outlook on the banking sector from stable to negative only to be criticised by Slovakia’s central bank (NBS) for being controversial – failing to reflect current developments and the then condition of Slovakia.
“NBS finds it important to make it clear that Slovakia's banking sector is sound, profitable and sufficiently equipped with capital,” according to the statement from the central bank in May. TASR
Compiled by Zuzana Vilikovská from press reports
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