This article presents updates to S&P Global Ratings' views on the 88 banking systems that it currently reviews under its criteria "Banking Industry Country Risk Assessment Methodology And Assumptions," published on Dec. 9, 2021, that it uses primarily when applying its methodologies to develop the stand-alone credit profile and issuer credit rating on a financial institution ("Financial Institutions Rating Methodology," Dec. 9, 2021).

We typically update this publication every month to summarize our latest BICRA assessments by group and country (table 1), economic and industry risk scores--summarized in chart 1--and components (table 2), and related assessments (government support assessments by region (table 3) and BICRA scores for estimates and regional averages (table 4). All these variables are current as of time of publication of this article, but some may be amended before the publication of our next monthly update.

Latest BICRA Action And Reports

Since we last published the BICRA update on March 28, 2025, we have:

• Albania: Assigned a BICRA in group 8.
• Egypt: Revised our economic risk trend to stable from positive.
• Italy: Revised our BICRA to group 4 from group 5, our economic risk score to 4 from 5, our industry risk score to 4 from 5, and our industry risk trend to stable from positive. We also revised some scores on economic risk- and industry risk-related factors.
• Kenya: Revised our economic risk trend to stable from negative and our industry risk trend to positive from negative.

Since we last published the BICRA update on March 28, 2025, we also published comprehensive BICRA reports on Macao and Switzerland.

Albania

We assigned Albania to BICRA group 8. The economic risk score for Albania is 8 and the industry risk score is 7. The economic and industry risk trends are both stable.

Egypt

We revised our economic risk trend for Egypt to stable from positive. This follows a revision of the sovereign rating outlook on Egypt to stable from positive. The outlook revision reflects the country's susceptibility to current global financial market volatility amid elevated external and domestic financing requirements.

We think that Egyptian banks are highly vulnerable to sovereign risks amid their high and increased direct exposure.

Italy

We revised our BICRA for Italy to group 4 from group 5 and our economic risk score to 4 from 5. This follows an upgrade of the sovereign thanks to a strengthening external position, strong household and corporate balance sheets, and still high but reducing fiscal imbalances. This eases potential sources of economic imbalances Italian domestic financial institutions face.

We also revised our industry risk score for Italy to 4 from 5. We perceive a structural improvement in Italian banks' profitability, with average return on equity remaining above the cost of capital for most banks. This is on the back of greater operating efficiencies, more resilient business models, and improved asset quality. We also revised our industry risk trend for Italy to stable from positive.

Kenya

We revised our economic risk trend for Kenya to stable from negative. Improving external financing conditions have reduced near-term vulnerabilities from economic imbalances in Kenya amid stabilizing economic risks for banks.

We also revised our industry risk trend for Kenya to positive from negative. Gradual improvement in governance and transparency standards among all banks and a more proactive approach of the regulator to ensure banks' compliance with regulation could, over time, reduce risks for banks.

About BICRAs

S&P Global Ratings uses its BICRA economic risk and industry risk scores to determine the anchor for a financial institution, which is the starting point of a rating (see paragraph 7 in the financial institutions criteria). Our BICRA criteria evaluate and compare the relative strength of global banking systems. BICRA scores are on a scale from 1 to 10 (see table 1), with group 1 representing the lowest-risk banking systems and group 10 the highest-risk ones (see paragraph 4 in the BICRA criteria).

A BICRA analysis for a country incorporates the entire country's financial system, taking into account the impact of entities other than banks on the financial system. It also looks at the conditions under which rated and unrated entities operate.

Our analysis of economic risk of a banking sector takes into account the structure, performance, flexibility, and stability of the country's economy, actual or potential imbalances in the economy, and the credit risk stemming from economic participants, mainly households and enterprises.

Our view of industry risk factors in the quality, effectiveness, and track record of bank regulation and supervision, as well as the competitive environment of a country's banking industry, including its risk appetite, structure, risk-adjusted financial performance, and possible distortions in the market. Industry risk also addresses the variety and stability of funding options available to banks, including the role of the central bank and government.

Part of our review involves an evaluation of the capacity and willingness of sovereigns (see table 3) to support failing banks (or nonbank financial institutions where applicable) during a crisis based on their systemic importance, classifying sovereigns into three groups: highly supportive, supportive, and uncertain (see paragraph 225 in the "Financial Institutions Rating Methodology"). Our view of the likelihood of extraordinary government support may influence our issuer credit rating on systemically important institutions in a particular country, according to our financial institutions criteria.

Table 1

Table 2a

Table 2b

Download table here.

Chart 1a

Chart 1b

We assess the capacity and willingness of sovereigns (see table 3) to support failing banks (or nonbank financial institutions where applicable) during a crisis based on their systemic importance, classifying sovereigns into three groups: highly supportive, supportive, and uncertain (see paragraph 225 in the "Financial Institutions Rating Methodology").

Table 3

BICRA Estimates And Regional Averages

Countries for which we do not perform BICRAs are assigned estimates or proxies (depending on the magnitude of rated entities' aggregate exposure to issuers in these jurisdictions) for the purpose of computing risk-adjusted capital ratios. These estimates are made using a simplified BICRA analysis for jurisdictions that rated banks have significant aggregate exposure to--typically of US$5 billion or more (across all the entities we rate). We may also perform a BICRA estimate if rated banks' aggregate exposure is not significant, but we consider it appropriate to assign an estimate.

Our BICRA proxies are usually calculated for jurisdictions for which global exposure is not very significant (i.e., typically below US$5 billion). The proxies are based on our foreign currency sovereign rating on the country for which we estimate the BICRA and economic and industry risk scores (see paragraph 12 in "Risk-Adjusted Capital Framework Methodology," April 30, 2024).

The BICRAs, economic risk scores, equity market groups (see paragraph 125), and long-term foreign currency sovereign credit ratings that we assign to groups of countries and to regions represent the GDP-weighted average of BICRAs, economic risk scores, equity market groups, and long-term foreign currency sovereign credit ratings on the countries in these groups and regions (see paragraph 151 in "Risk-Adjusted Capital Framework Methodology").

Table 4

Related Criteria

• Risk-Adjusted Capital Framework Methodology, April 30, 2024
• Financial Institutions Rating Methodology, Dec. 9, 2021
• Banking Industry Country Risk Assessment Methodology And Assumptions, Dec. 9, 2021
• Sovereign Rating Methodology, Dec. 18, 2017

Related Research

• Banking Industry Country Risk Assessment: Macao, April 21, 2025
• Various Rating Actions Taken On 15 Italian Banks On Sovereign Upgrade And More Resilient Industry Dynamics, April 18, 2025
• Outlook On Three Egyptian Banks Revised To Stable From Positive; 'B-/B' Ratings Affirmed, April 16, 2025
• Albania Assigned To Banking Industry Country Risk Assessment Group ‘8’, April 1, 2025
• Banking Industry Country Risk Assessment: Switzerland, March 31, 2025
• Improving Economic Conditions In Kenya Could Drive Growth In Private-Sector Lending, March 27, 2025
• Global Banks Outlook 2025 Interactive Dashboard, Nov. 14, 2024
• Global Banks Country-By-Country Outlook 2025: Cautiously Confident, Nov. 13, 2024
• Global Banks Outlook 2025: Cautiously Confident, Nov. 13, 2024