Citing better operational conditions and strong financial performance, Moody’s Ratings changed its outlook on Pakistan’s banking industry from stable to positive on Wednesday.
Banks’ substantial exposure to sovereign debt supports the change, which is consistent with the government’s (Caa2 positive) improved outlook.
The Moody’s statement read, “We have shifted our outlook on Pakistan’s banking system from stable to positive to reflect the banks’ resilient financial performance as well as improving macroeconomic conditions from very weak levels a year ago.”
On March 3, 2023, Moody’s last downgraded Pakistan’s banking industry, downgrading the long-term deposit ratings of five major banks: United Bank Ltd. (UBL), Habib Bank Ltd. (HBL), Allied Bank Limited (ABL), MCB Bank Limited (MCB), and National Bank of Pakistan (NBP).
