...Better Positioned than Pre-1997: A tougher operating environment amid sluggish economic growth, depreciating currencies and falling commodity prices will continue to challenge banks in many parts of the ASEAN region. Currency, credit and liquidity risks are increasingly coming into focus, and asset quality is likely to deteriorate. Fitch Ratings believes ASEAN banks are better positioned than prior to the 1997 Asian Financial Crisis (AFC). These risks have already been factored into our ratings for banks and sovereigns. The ASEAN countries are now less dependent on foreign capital, with broadly stronger external liquidity, a flexible currency regime and a stronger banking framework. One negative, however, is a more leveraged household sector ¡ Thailand and Malaysia in particular ¡ but the risk is contained by modest expected GDP growth in ASEAN and slowing growth in household debt. Indonesia, Malaysia More Affected: The risks facing ASEAN banks are not evenly dispersed. Fitch believes Malaysia...
