California wildfire raises risk for credit issues for banks - Raymond James
21/11/2018 13:40
** Raymond James says damage from the ongoing California
wildfires raises the risk for credit issues in the near term for
banks, primarily in the form of higher provisions and weakened
credit quality, particularly for those with operations in the
affected counties
** However, bank credit quality will likely not be impacted
significantly since borrowers are generally well insured -
Raymond James
** Banks in affected areas are more likely to suffer losses
due to temporary branch closures or damage to branch locations,
Raymond James says
** Banks might see an outflow of deposits as affected
individuals and businesses, that incurred significant damage,
may need to withdraw funds for living expenses
** On the other hand, insurance payments, government
assistance could result in deposit inflows, the brokerage says
** On a longer term basis, banks could see an increase in
loan demand to support the rebuilding process
** Within Raymond James' coverage universe, Trico Bancshares
TCBK.O has the most exposure to Camp Fire; however, underlying
collateral for loans made by the bank in the impacted areas has
been "relatively modest", and in all cases, the properties are
insured for loss - brokerage
(Reporting By Aparajita Saxena in Bengaluru)
((Aparajita.Saxena@thomsonreuters.com; within U.S. +1 646 223
8780, outside U.S. +91 806 749 8901; Reuters Messaging:
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