Moody’s cuts outlook for Swiss banking system to negative

FXStreet (Łódź) - Moody’s ratings agency announced on Thursday its decision to downgrade the outlook from Switzerland’s banking system from Aaa stable to negative, suggesting that the probability of senior creditors from the Swiss government providing support when needed had weakened.

According to the report: “Moody's view reflects the government's move forward to implement a resolution framework allowing burden-sharing with creditors (bail-in) to resolve failing domestic banks.”

“Moody's believes that the negative implications of diminishing support for senior creditors outweigh the otherwise more positive elements that will continue to support the banks' standalone credit profiles.”