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Banks in Turkey and Tunisia are most vulnerable to tighter financing conditions, according to SandP Global


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    LONDON, April 17 (Reuters) - Tighter global financing conditions are putting pressure on emerging market banking systems, with those in Turkey and Tunisia most at risk, ratings agency S&P Global said in a report on Monday.

    S&P said its base-case scenario was that Turkish banks would retain access to external funding, but with a moderate decline in rollover rates as long as the government contains balance-of-payment risks.

    "We consider that Turkish banks are particularly vulnerable to negative market sentiment, increased risk aversion, reductions in global liquidity, and higher financing costs," S&P's analysts wrote in a note.

    The country's banks also remain significantly exposed to the unwinding of economic imbalances built up in recent years, such as a surge in real estate prices and highly accommodative monetary policy amid hyperinflation

    Lira weakness also weighs on the credit worthiness of Turkish firms, the agency added.

    Reporting by Karin Strohecker, editing by Marc Jones

    Our Standards: The Thomson Reuters Trust Principles.

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