Moody's Talks - Focus on Finance

Frank Yuen and Laura Bazer explain why the outlook for life insurers worldwide is less bleak than it was a year ago. Plus, Bruce Ballentine and Benjamin Serra discuss the strengths that help insulate global property and casualty (P&C) insurers from higher claims as economies reopen.Related content on Moodys.com (some content only available to registered users or subscribers): P&C Insurance – Global – 2022 OutlookLife Insurance – Global – 2022 OutlookLife & Health Insurance – US – 2022 outlook stable, as US economic recovery solidifies

Banking analysts Michael Rohr and Donald Robertson explain how our outlook has improved for banks worldwide. Plus, Banking team analyst Svetlana Pavlova discusses how demographic trends in emerging markets are driving a divergence in banks’ growth and profitability prospects.Related content on Moodys.com (some content only available to registered users or subscribers): Banks – Global: 2022 outlook stable, reflecting sound capital and liquidity, with low credit losses (Slides)Banks – Emerging markets: Demographic trends will drive divergence of growth and profitability prospects 

Dominic Simpson and Neal Epstein of the Asset Management team discuss prospects for global asset managers in 2022, as the global economic recovery and demand for alternative and ESG investments drive industry growth. Meanwhile, Ceres Lisboa, Ashraf Madani and Eugene Tarzimanov  of the Banking team explore how emerging markets banks will benefit from G20 economies’ recovery, strong global demand for commodities and a rise in interest rates.Related content on Moodys.com (some content only available to registered users or subscribers): Asset Managers – Global: 2022 Outlook stable on economic recovery, strong demand Emerging market banks’ outlook is stable as credit conditions support financial fundamentals

Insurance analysts Dominic Simpson and Manoj Jethani discuss global insurers’ increasing investments in illiquid assets and why that’s mostly positive despite the risks. Plus, Fadi Massih of the Banking team talks about strengths and vulnerabilities in global banks’ management of cybersecurity risks.Related content on Moodys.com (some content only available to registered users or subscribers): Cyber Risk - Global Banks of all sizes and credit strengths are increasing cybersecurity investmentLife & Health Insurance – United Kingdom Growing illiquid asset exposure is more credit positive than negativeLife Insurance – US: Illiquid assets rise, increasing returns while raising portfolio risk  Insurance – Europe: Insurance CFOs ready for M&A amid cautious post pandemic optimismBenefits of insurers’ growing illiquid asset exposure balance additional risks 

Mark Wasden of the Banking team and Chris Padgett of the Corporate Finance team explain how as US private credit grows, there is greater risk of widespread market disruption should the economy falter. Plus, Insurance team analyst Shachar Gonen explains why long-term care insurers are getting a brief reprieve, and Fadi Massih of the Banking team talks about the new Bitcoin ETF and why it is credit negative for Coinbase. Guests: Shachar Gonen, Vice President, Senior Credit Officer –  Financial Institutions Group, Moody’s Investors Service; Fadi Massih, Vice President, Senior Analyst  –  Financial Institutions Group, Moody’s Investors Service; Christina Padgett, Associate Managing Director – Corporate Finance Group, Moody’s Investors Service; Mark Wasden, Senior Vice President – Financial Institutions Group, Moody’s Investors Service Hosts: Danielle Reed, Vice President, Senior Research Writer – Financial Institutions Group, Moody’s Investors Service; Michael Porta, Vice President, Senior Research Writer – Financial Institutions Group, Moody’s Investors Service Related content on Moodys.com (some content only available to registered users or subscribers): Property & Casualty Insurance – Global: Proliferation of cyberattacks prompts re-evaluation of cyber insurance riskAuto Finance – Global: Sector can manage surge of residual value risk as electric vehicles come on line

Cybercrime has driven up demand for cyber insurance. But losses are on the rise, too, and some cyber events are uninsurable. How are insurers responding to higher losses, and what can be done about the kinds of risks that are too big for private insurers to cover? Plus, sales of alternative fuel vehicles worldwide are accelerating. What does it mean for the credit quality of auto finance captives, the companies that finance loans and leases on behalf of automakers?Guests: Michael Dion, Vice President, Senior Analyst – Financial Institutions Group, Moody’s Investors Service; Inna Bodeck, Vice President, Senior Analyst  – Financial Institutions Group, Moody’s Investors ServiceHosts: Danielle Reed, Vice President, Senior Research Writer – Financial Institutions Group, Moody’s Investors Service; Myles Neligan, Vice President, Senior Research Writer – Financial Institutions Group, Moody’s Investors ServiceRelated content on Moodys.com (some content only available to registered users or subscribers): Property & Casualty Insurance – Global: Proliferation of cyberattacks prompts re-evaluation of cyber insurance riskAuto Finance – Global: Sector can manage surge of residual value risk as electric vehicles come on line

Ahead of the COP 26 conference in Glasgow, analysts Lev Dorf, Brandan Holmes and Vanessa Robert explain why banks, insurance companies and asset managers are under pressure to reduce exposure to carbon-intensive industries. Indeed Moody's has estimated that G20 financial institutions are exposed to carbon transition risk to the tune of a staggering $22 trillion. However, financial institutions will need to play a vital role in financing the shift to net zero, and in this episode our team discuss what new areas of economic growth are emerging, amid the risks of decarbonization. Inside this episode:Brandan Holmes on the drivers of  decarbonization for insurance (begins at 2:38 mins) Lev Dorf on the biggest risks of decarbonization for banks (begins at 9:08 mins Lev Dorf discusses the economic opportunities for banks (begins at  13:17 mins) Related Content:Financial firms face challenge of supporting corporate clients through the carbon transition (free to register) Infographic (free to register): Data on G20 financial institutions reveals $22 trillion of carbon transition 

Peter Nerby, Olivier Panis and Shunsaku Sato explain how global systemically important banks are faring as the pandemic starts to recede. Dean Ungar discusses the implications for US health insurers should the Medicare hospital insurance trust fund run out of money. And David Yin tells us how a recent cryptocurrency ban in China is positive for financial institutions.Inside this episode:Dean Ungar discusses the implications for US health insurers should the Medicare hospital insurance trust fund run out of money. (begins at 2:48 mins)David Yin tells us how a recent cryptocurrency ban in China is positive for financial institutions. (begins at 5:06 mins)Peter Nerby, Olivier Panis and Shunsaku Sato explain how global systemically important banks are faring as the pandemic starts to recede. (begins at 8:22 mins) Related content:Banks – Global: Biggest banks retain competitive advantage, but stiff obstacles loom post pandemic - Most of the 30 large, global systemically important banks have maintained strong capitalization and liquidity, and their profitability is stronger than that of regional peers.Financial Institutions – North America: Looming Medicare trust fund depletion is credit negative for MA insurers - The trust fund's depletion would require reduced Medicare spending, which could mean lower payments for Medicare Advantage (MA).Financial Institutions – China: China's crackdown on virtual currencies is credit positive for financial institutions - Chinese authorities' crackdown on cryptocurrencies will support financial stability and back China's policy of reducing carbon emissions.  

Stephen Tu, Melina Skouridou and Farooq Khan explain how four forces reshaping finance will likely reduce banks’ revenue from core activities and undermine their role as financial intermediaries. Plus, Alka Anbarasu explains why India’s banks will weather the stress from a COVID-19 resurgence, and Jasper Cooper gives an update on insured hurricane losses in the US.Inside this episode:Alka Anbarasu explains why India’s banks will weather the stress from a COVID-19 resurgence. (begins at 1:55 mins)Jasper Cooper gives an update on insured hurricane losses in the US. (begins at 4:48 mins)Stephen Tu, Melina Skouridou and Farooq Khan explain how four forces reshaping finance will likely reduce banks’ revenue from core activities and undermine their role as financial intermediaries.  (begins at 7:11 mins)Related content:Banks – India: Resurgence of coronavirus raises asset risks but loan-loss buffers are sufficiently strong - A resurgence of coronavirus cases will lead to more problem loans. However, a sharp increase in problem loans is unlikely, and banks have sufficient buffers to absorb anticipated lossesProperty & Casualty Insurance– US Hurricane Ida's Northeast track adds billions to insurers' losses - Hurricane Ida's damages through New York, New Jersey and surrounding states will increase insurers' losses by billions of dollars.Reinsurance – Global:  Weak La Niña and warm waters point to active 2021 Atlantic hurricane season - Above average sea surface temperatures, weaker trade winds and an enhanced West African monsoon result in more favorable conditions for hurricane formation and intensification this year.Financial Institutions – Global: Four forces reshaping financial landscape have potential to dislodge incumbents - We identify four forces of digitalization that have the potential to dislodge incumbents from dominant positions in financial markets.Banking – Global: Central banks aim to limit disruption when designing retail digital currencies - Banks would likely maintain their client-facing roles and would play a part in disseminating central bank digital currencies (CBDCs), but disintermediation risks will be heightened.Banks – Cross Region: Wide use of digital currencies in cross-border payments would be credit negative - Potential future wide acceptance of central bank digital currencies in cross-border payments and settlements will result in lower fees and commissions for banks.

Analyst Fadi Massih discusses the credit strengths and weaknesses of the crypto asset exchange.Related content: Coinbase Global, Inc. Strong finances and market position offset by uncertain regulatory environment and fierce competitive conditions - Coinbase displays investment grade characteristics and financials that are offset by a challenging operating environment marked by uncertain regulatory framework and fierce competition.