...Moderate reliance on wholesale funding. Outlook: Stable S&P Global Ratings' stable outlook on Erste Group Bank AG (Erste) reflects our view that its improved risk-adjusted capitalization now provides the group with a sufficient buffer to withstand many unforeseen risks arising from its CEE operations in the next 12-24 months. We consider the operating environment in Erste's biggest core markets--Austria and the Czech Republic--to be stable, allowing it to generate steady revenues from its traditional customer-led retail and corporate customer business. In our view, this will support a further gradual capital build-up. We could lower the rating if Erste was unable to maintain the risk-adjusted capital (RAC) ratio above 7% or if, against our expectation, its asset quality deteriorated. We consider a positive rating action unlikely at present. That said, it could be triggered by a shift in Erste's operations toward lower-risk countries while continuing to improve its capitalization. This would...
