Middle East conflict poses limited direct bank risk, says agency

At the present stage, the direct and indirect effects of the expanding conflict in the Middle East on international banks and asset managers are considered manageable, according to a report by Morningstar DBRS.

The rating agency stated that international banking groups do not have material direct exposures in the Middle East, thereby limiting immediate credit risk.

However, it warned that indirect effects are expected to arise mainly through macroeconomic channels, which could affect loan portfolio quality...