(Bloomberg) -- Asia-Pacific banks are well-placed to ride out the volatility caused by the collapse of Silicon Valley Bank, according to S&P Global Ratings.
Of the 18 jurisdictions in the region the assessor covers, the industry trend is positive in Australia and stable in all the others. Among those most exposed to the market turmoil are some Japanese banks with large US Treasury holdings, but S&P doesn't expect an imminent change to their ratings.
“Most banks have reasonable buffers,” it said on Thursday, adding that direct exposure to SVB in the region was negligible and second-round effects manageable. “Only a significant escalation would be sufficient to change our view.”
The comments were published just hours after Credit Suisse Group AG tapped as much as 50 billion francs ($54 billion) of central bank funding to stem a crisis of confidence that has sent shockwaves across the global financial system. Gavin Gunning, a Melbourne-based analyst, declined to comment on developments at Credit Suisse.
S&P said that in Japan's case, the interest rate sensitivity of banks such as Norinchukin Bank, Japan Post Bank Co. Ltd., and Shinkin Central Bank, which focus on securities investment rather than lending, is very high.
“In the unlikely event of a financial crisis, bailouts of key banks would be the likely course of action for most Asia-Pacific jurisdictions, including all the G-20 governments in the region,” it said.
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