...- Despite governments' measures to contain the COVID-19 pandemic, European economies, including Austria, face an unprecedented challenge. - We continue to expect the Austrian government's wide-ranging fiscal and related monetary measures to substantially mitigate this extraordinarily sharp, cyclical shock to the economy, and so also support the banking system in its key role as a conduit of fiscal and monetary support. - Even under our base case of an economic recovery starting in third-quarter 2020, we expect bank earnings, asset quality, and in some cases, capitalization, to weaken meaningfully through end-2020 and into 2021. - We are therefore revising the outlook on several Austrian banks, reflecting the aforementioned factors and our view that downside risks remain substantial. That said, we continue to see differentiated implications for banks in the system. - We could take negative rating actions if we expect the cyclical economic recovery to be markedly weaker or delayed, as this...
