Moody’s drops Oman banking system to negative

Moody's Investors Service said it changed Oman's banking system's outlook to negative from stable, primarily to reflect the softening operating environment for banks in the context of low oil prices.

The negative outlook also reflects Oman government's weakening capacity to support the banks in case of need.

"Slower economic growth will translate into weaker credit growth for the banks and moderate pressure on their funding, asset quality and profitability, albeit from a strong base," Moody’s analyst Mik Kabeya said in a news release.

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