OIL PRICE CRASH PADS ASSET RISKS TO ASIAN BANKS

Moody's Investors Service says an unprecedented plunge in oil prices since March this year is adding to asset risks for banks in Singapore, Malaysia, Japan and South Korea, the New Straits Times reported on Friday, May 22, 2020.

This, the firm said, is due to the fact that they simultaneously coped with consequences of the coronavirus outbreak but added that Chinese banks were not materially exposed.

Moody's expects oil prices to remain low for the rest of the year, suppressed by a supply glut and weak demand that economic disruptions from the coronavirus outbreak were exacerbating, the New Straits Times added.

"This will increase stress among companies across the oil and gas industry," it added. Moody's said banks in Singapore, Malaysia, Japan and Korea had the largest exposures to borrowers affected by changes in oil prices in Asia.