Once the government phases out measures to support the financial sector, some banks are likely to experience a deterioration of capital and profitability ratios, APA-Economics reports citing the report of World Bank.
"Downside risks to this forecast will remain substantial in the medium term. The existing oil market equilibrium is fragile and largely depends on the OPEC+ agreements. In addition, the evolution of the pandemic is still uncertain and will depend on the speed of the vaccine rollout. Finally, regional geopolitical risks will remain elevated in the foreseeable future. Significant SOFAZ reserves—over 100 percent of GDP at end-2020—will help shield the economy from these risks," the reports reads.