COVID-19 resurgence raises asset risks for Southeast Asian and Indian banks

As infections rise and overall vaccination rates remain low in Southeast Asian nations and India, loan performance will weaken as economic recoveries stall, although the effects will vary by country. However, government support and strong loss-absorbing buffers will support banks’ credit strength.Related content:Property & Casualty – United States of America Losses from Dixie wildfire will hit California property and casualty insurers - Total insured losses from California wildfires are likely to exceed $1 billion for California homeowners insurers and commercial property insurers. Allianz SE US DOJ investigation into investment funds raises financial and reputational risk - DoJ investigation into investment activities of “Structured Alpha” funds raises the risk of a financial hit to the group and highlights governance challenges of complex groups. Aon, Willis Towers Watson Termination of Aon-Willis Towers Watson merger agreement poses governance challenge for WLTW - Aon and WLTW must reset their corporate strategies after terminating their proposed merger. The firms reduced their financial leverage and accumulated cash in preparation for the merger. Banks – ASEAN and India Asset risks will rise amid resurgences of coronavirus infections but credit strength will remain intact  - Asset risks will rise for banks in the region amid a surge in coronavirus cases. However, the negative impact will be mitigated by continued policy support and strong loss-absorbing buffers.