Name: Credit Outlook 2024 - European Banking
Start: 2023-12-13T15:00:00Z
End: 2023-12-13T15:00:20.000Z
Location: BrightTALK
Rating: 4.2

Morningstar DBRS is a leading provider of independent rating services and opinions for corporate and sovereign entities, financial institutions, and project and structured finance instruments globally. Rating more than 4,000 issuers and 60,000 securities, we are one of the top four credit rating agencies in the world and a market leader in Canada, the U.S. and Europe in multiple asset classes.



Frontline Perspectives on Trends In Global Corporate Real Estate and Commercial Mortgage Back Securities sectors. Some of these include the growth of data centers as an asset class, re-opening up of the NA CMBS market and acceleration of Corporate Real Estate issuance, and an update on the trends in CMBS surveillance.

Frontline Perspectives: Trends In Global Corporate Real Estate and CMBS Sectors

During the second quarter of 2024, Morningstar DBRS issued and refreshed a total of 286 CEs across 279 borrowers for 26 lenders including managers of CLOs and private credit funds. Total volumes include CEs assigned to new borrowers and existing CEs refreshed for periodic review and amendments, as well as a handful of internal assessments. Currently, Morningstar DBRS assigns CEs to about 1,400 leveraged corporate borrowers. CEs are not credit ratings, but rather point-in-time assessments of credit quality, which are used to estimate borrower default likelihood in CLOs, rated feeder funds, investment fund debt, equipment leases, and other structured finance transactions.

Join Morningstar DBRS on September 10 for a Frontline Perspectives webinar detailing second-quarter CE activity and performance, presented by Jerry van Koolbergen and Orest Gavrylak. The discussion will highlight overall credit quality, financial metrics year-to-date, revenue growth, and anticipated CE volume in the third quarter of 2024.

Frontline Perspectives: Credit Estimate Quarterly Snapshot Q2 2024

Join Morningstar DBRS' analysts for a discussion of U.S. banking companies Q2 earnings and trends. John Mackerey, Senior Vice President and Sector Lead, North American Financial Institution Ratings and Mike McTamney, Senior Vice President, North American Financial Institution Ratings, will discuss capital levels, funding and liquidity, and credit quality trends, as well as what can be expected moving forward with monetary policy uncertainty.

The discussion will be followed by a Q&A session.

Frontline Perspectives: U.S. Banks' Q2 2024 Earnings Round-Up

OSFI has recently announced a one-year delay in the phase-in period for the implementation of a 72.5% Basel III output floor in Canada. While the adoption of the revised output floor comes with potential economic costs, we view full adoption and implementation as further strengthening Canadian banks' ability to withstand financial shocks.

Join us for a discussion on the implementation in Canada of the final Basel III capital floor rule and implications for the banks' capital management and optimization activities.  

The discussion will be followed by a Q&A for all who wish to participate, and a recording will be provided at the same link for those unable to attend.

Frontline Perspectives: OSFI's Extension of the Output Floor Phase-In Timeline

Watch Morningstar DBRS' analysts hosted webinar on India’s macroeconomic outlook post elections. The cumulative and ongoing benefits of India's reform efforts look likely to lift potential growth rate and facilitate fiscal consolidation.

Frontline Perspectives: India's Outlook After the Election

Morningstar DBRS is pleased to present the latest Frontline Perspectives webinar focused on the key policy changes from the UK General elections held on Thursday 4th July, 2024.

Nichola James, Managing Director of Global Sovereign Ratings, and Adriana Alvarado, Senior Vice President, Sector Lead of Global Sovereign Ratings reviewed the overarching themes observed during the elections. The webinar provides valuable perspectives on the implications and challenges for the UK. The presentation is 20 minutes.

Frontline Perspectives: The UK General Election - Key Policy Challenges

During the first quarter of 2024, Morningstar DBRS issued and refreshed a total of 316 credit estimates (CEs) across 310 borrowers for 31 lenders including collateralized loan obligations (CLO) and fund managers. Total volumes include new CEs assigned for new and existing borrowers and existing CEs refreshed for periodic review and amendments. Currently, we assign CEs to about 1,400 leveraged corporate borrowers. CEs are not credit ratings, but rather point-in-time assessments of credit quality, which are used to estimate borrower default likelihood in CLOs, rated feeder funds, investment fund debt, equipment leases, and other structured finance transactions 

Join DBRS Morningstar on June 27 for a Frontline Perspectives webinar detailing the first quarter CE activity and performance, presented by Jerry van Koolbergen and Orest Gavrylak. The discussion will highlight overall credit quality, financial metrics year-to-date, revenue growth, and anticipated CE volume in the second half of 2024.  

A Q&A session will follow the presentation for the audience to participate in the conversation.

Frontline Perspectives: Credit Estimate Quarterly Snapshot - April 2024

Heading into the second half of 2024, the Big Six banks are still facing a challenging operating environment but continue to maintain ample liquidity and solid capital. Q2 2024 sequential adjusted earnings increased modestly driven by higher noninterest income, paired with a slight reduction in noninterest expenses. However, credit deterioration progressed further in Q2 2024, with impaired PCL increasing for the seventh-consecutive quarter. Following the Bank of Canada's 25 bps interest rate cut on June 5, 2024, some much needed relief should be provided to heavily indebted Canadian borrowers as debt continues to reprice at maturity, along with a potential boost to muted loan growth and moderating net interest income. 

Join us for a discussion on the Large Canadian Banks Q2 2024 Round-Up. Carl De Souza, Senior Vice President and Sector Lead, North American Financial Institution Ratings will discuss capital levels, funding and liquidity, and credit quality trends, as well as what can be expected moving forward with monetary policy uncertainty. 

The discussion will be followed by a Q&A session.

Frontline Perspectives: Large Canadian Banks Q2 2024 Earnings Round-Up

A challenging macroeconomic environment is impacting Canadian credit unions as deposit repricing has pressured net interest margins. However, not all credit unions have been affected equally. 

Join us for a discussion on factors impacting the variations in the financial performance of our rated Canadian credit unions including provisions for credit losses, asset spreads, and balance sheet composition. We will also cover our outlook on earnings and credit risks as we move through 2024. 

The discussion will be followed by a Q&A for all who wish to participate, and a recording will be provided at the same link for those unable to attend.

Canadian Credit Unions 2024 Outlook: A Period of Headwinds for Earnings

Morningstar DBRS invites you to attend a webinar on 18 June at 03:30 p.m. BST | 04:30 p.m. CEST | 10:30 am EDT. The webinar will be hosted by Marcos Alvarez, Managing Director, Global Insurance Ratings at Morningstar DBRS, and guest speaker Phil Baker, President of BOXX Canada & Global Chief Underwriting Officer.

Businesses and governments across the globe have experienced a significant surge in cyber incidents in recent years, resulting in a dramatic increase in the demand for cyber insurance products. While cyber insurance is an attractive market opportunity for insurers, it also presents a different type of risk to manage. One that can be more difficult to price than most other insurance risks, given the relative lack of comprehensive data, the evolving nature of cybercrime, the potentially catastrophic nature of cyber-attacks, and the high level of technical expertise required to value this risk correctly.

Join us for a discussion about the current state of the cyber insurance market. We will examine potential opportunities for insurance companies and how they can provide value to clients looking to manage their increasing exposure to cyber risks and enhance their insurability.

The discussion will last approximately 30 minutes, followed by an interactive question-and-answer session. Morningstar DBRS welcomes all who wish to participate.

Frontline Perspectives: Cyber Insurance 2024: Opportunities, Risks, and Insights

Morningstar DBRS is pleased to present the latest Frontline Perspectives webinar focused on the key takeaways from the European Parliament elections held from 6 June to 9 June 2024.

Nichola James, Managing Director of Global Sovereign Ratings, and other Morningstar DBRS senior analysts reviewed the overarching themes observed during the elections. The webinar provides valuable perspectives on the implications and challenges for Europe, with a specific focus on countries like France and Italy. The presentation is 25 minutes.

Frontline Perspectives: Key Takeaways from the European Parliamentary Elections

Following the conclusion of the 28th annual Global ABS conference, Morningstar DBRS is pleased to invite you to a Frontline Perspectives webinar on the key takeaways from Barcelona last week. Join Mudasar Chaudhry, Head of European Structured Finance Research in conversation with senior DBRS Morningstar analysts as they recap the highlights and key themes at the conference.

Join Morningstar DBRS on 13 June 2024 at 3:00 p.m. BST to catch up on topical trends and panel discussions at the Global ABS event. The presentation will last approximately 45 minutes and will be followed by a Q&A session for the audience to participate in the conversation.

Frontline Perspectives: Global ABS 2024 Conference – Key Takeaways

Stephanie Mah, Senior Vice President, Structured Finance Research, will host a discussion with senior analysts, Hylton Heard, Senior Vice President, US ABS and David Laterza, Senior Vice President, North America Financial Institutions on the state of the aviation market, including aircraft lessor financial performance, supply/demand, asset values, and recoveries against the backdrop of ever changing macroeconomic and geopolitical risks.

Frontline Perspectives: Aviation Structured Finance Mid-Year Update

Climate change presents both physical and transitional risks for the aviation industry. In striving to reach net zero by 2050, airlines are undergoing major technological transformation in the medium and long term. Physical climate risks continue to test the industry’s operational resilience while the evolving regulatory landscape could also negatively affect air travel demand.

Join us for a climate change webinar as we discuss Morningstar DBRS’ climate risk considerations for the airline and airport sectors, presented by Rohit Kumar, Assistant Vice President, Diversified Industries, Valiant Ip, Vice President, Asset Finance, and Kevin Li, Senior Vice President, Asset Finance. Our discussion will cover relevant industry trends, key drivers of decarbonization, potential credit impact and risk mitigations. Following the presentation, the audience is invited to participate in a Q&A session.

The Green Takeoff: Challenges and Opportunities for the Aviation Sector

German Banks have significant exposure to commercial real estate, including the office segment which is currently under pressure due to the hybrid work environment and higher interest rates. The US office market has experienced particular stress, which has adversely affected most German banks with operations in the US.

 

Join us for a discussion hosted by Erin Stafford, Managing Director, North American Real Estate Ratings and Sonja Förster, Vice President, European Financial Institutions. We will review trends in the US office market, the current financing situation for office properties, and the protection for lenders. We will then discuss the real estate exposure and performance of German banks, with particular focus on US office exposure.

German Banks’ CRE Lending: U.S. Office Loans Driving Increasing NPLs

In line with International Women’s Day, Morningstar DBRS researched female representation in the Canadian banking sector. While in Canada we see greater representation than global counterparts, there is still work to be done. Despite initial representation, gender diversity often stops progressing and hits a ceiling that is likely to bounce off. 

Join us for this Frontline Perspectives conversation hosted by Jiani Wu, Vice President, North American Financial Institutions and Sailie Ashtekar, Senior Analyst, North American Financial Institutions. We will review our findings, including data broken down by different levels of the talent pipeline. We will also explore how gender diversity can be attained at all levels of the banking organization including through DEI initiatives, stakeholder scrutiny and building an equitable talent pipeline. A Q&A will follow for all who wish to participate in the conversation.

Frontline Perspectives: Women at Canadian Banks: Fortified Glass Ceiling?

In February 2024, Morningstar DBRS published an updated methodology to rate subscription loans titled “Rating Debt Issued by Investment Funds, Appendix I – Subscription Loan Facilities”.  The updated methodology supersedes “Rating and Monitoring Subscription Loans (Capital Call) along with the predictive model, “Diversity Model for Capital Calls.” 

The changed methodology expands the criteria for the subscription loan asset class globally and moves the criteria to an appendix of the “Global Methodology for Rating Debt Issued by Investment Funds” (the Fund Methodology). With the move to an appendix of the Fund Methodology, the ratings assigned to subscription loan transactions will be corporate ratings instead of structured finance ratings. 

Join Morningstar DBRS for a Methodology Review webinar as we highlight the changes to our approach to rating and monitoring subscription loans. Presented by Jerry van Koolbergen, Managing Director, Structured Credit, and Stuart Rothenberg, Senior Vice President, Structured Credit, our discussion will feature the material changes including updates to (1) Morningstar DBRS’ approach for modeling high net-worth individuals (HNWIs), (2) the recovery rate and correlation assumptions for LP investors, and (3) the jurisdictions used for recovery rates. Additionally, the methodology update proposes the utilization of the CLO Insight Model to assess the credit risk of the LP investors and to derive a range of asset coverage ratios.

Following the presentation, the audience is invited to participate in a Q&A session to participate in the conversation.

Methodology Review: Subscription Loans

With the announcement of the Electric Vehicle Availability Standard, Canada joins the U.K along with other European and US jurisdictions in mandating a 100% zero-emission vehicle sales target for light-duty vehicles by 2035. The sale of fully or partially electric-powered vehicles is gaining traction in Canada, with most early adopters leaning toward hybrids instead of fully electrified vehicles. However, the U.K. and Europe are ahead in the transition and those insurers are already experiencing emerging effects. 

Join Morningstar DBRS for a discussion on how momentum in zero-emission and hybrid vehicle sales could affect Canadian auto insurance premium rates. We will review the implications for both buyers and insurers and explore nuances unique to the Canadian market, such as the highly regulated nature of the industry. The conversation will be moderated by Marcos Alvarez, Managing Director, Global Insurance Ratings, and will include Victor Adesanya, Vice President, North American Insurance Ratings and Robert Streda, Senior Vice President, Diversified Industries. A Q&A will follow for all who wish to participate.

Frontline Perspectives: How Will the EV Transition Effect Auto Insurance Rates?

Join DBRS Morningstar on 13 December 2023 for a webinar moderated by Nicola De Caro, Senior Vice President, European Financial Institution Ratings. He will be joined by Sonja Forster, Vice President, European Financial Institution Ratings and Arnaud Journois, Vice President, European Financial Institution Ratings.

Our analysts will focus on European banking trends, discussing the increase in profits in 2023 due to higher net interest income and lower credit costs. They will also delve into the challenges expected in 2024, such as pressure on profits, slow loan growth, higher expenses, and credit costs.

Additionally, the webinar will examine how higher interest rates and economic weaknesses might affect asset quality in European economies and the stress it might put on business loan portfolios and households with variable-rate mortgages.

The discussion will last approximately 30 minutes and will be followed by an interactive question-and-answer session.

Credit Outlook 2024 - European Banking

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Credit Outlook 2024 - European Banking

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