Fitch puts two Polish banks on watch

Fitch Ratings said it placed the issuer, viability and national ratings of mBank SA and Pekao Bank Hipoteczny on rating watch negative.

The agency cited the lower operating environment score for Poland to bbb from bbb+, which constrains the banks’ viability ratings for the RWN.

“Fitch has downgraded the operating environment score because in its view, the recently introduced payment holidays on local-currency mortgages are further evidence of the willingness of the Polish authorities to intervene in the banking sector and impose large additional costs on banks. This most recent measure comes in addition to the sizeable bank tax and as banks need to make substantial provisions for legal risks relating to Swiss-franc mortgage loans. The authorities have been also putting pressure on banks to raise deposit rates,” the agency said in a press release.

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