Moody's: Hungary stays negative

Moody's Investors Service said the outlook on Hungary's banking system remains negative.

Moody's said the key drivers of the outlook are (a) a persistently weak operating environment; (b) further deterioration in asset quality; and (c) continued pressure on profitability, funding and capitalization.

"We expect Hungarian banks to face a weak operating environment in the next 12-18 months. Hungary's economy continues to deteriorate, as its high dependence on exports and capital inflows exposes the country to the euro area's weak growth prospects," Moody's vice president and senior analyst Simone Zampa said in a news release.

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