Moody's: Negative view for Slovenia banks

Moody's Investors Service said it continues to hold a negative outlook on the Slovenian banking system for the third consecutive year, based on the persistent difficult operating conditions, ongoing asset-quality deterioration and the banks' limited capital resources to absorb further loan losses.

The outlook also expresses expectations for the fundamental credit conditions in this banking system over the next 12 to 18 months, the agency said.

The negative outlook also considers the largest banks' significant reliance on international market funding, which is currently constrained, Moody's said.

The negative factors are only partly offset by governmental funding support and broader implied systemic support, the agency said.

Two of the three largest Slovenian banks were able to generate positive earnings throughout the recent recession, Moody's added.

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