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Virus to boost Asian bank credit costs by US$100b: S&P
[HONG KONG] The coronavirus outbreak will add US$100 billion in credit losses to banks in the Asia-Pacific region this year with Chinese lenders bearing the brunt of the damage, according to S&P Global Inc.
"Some activity will be lost forever," Shaun Roache, S&P's Asia-Pacific chief economist, wrote in a note on Tuesday. "We estimate an income loss of about US$211 billion, which will blow a hole in balance sheets across the region."
The Covid-19 crisis will likely exert sharp, short-term pressure on Chinese banks, the report said.
The ratings firm said almost a quarter of Chinese property sector ratings and outlooks may come under pressure. S&P lowered its forecast for Asia-Pacific growth by 0.8 percentage point, to 4 per cent for 2020.