The international rating agency “S&P Global Ratings” has identified the key risks for the banking sector in the EMEA region (Europe, the Middle East, and Africa), including Azerbaijan, for 2026, APA-Economics reports.
S&P stated that geopolitical uncertainty in the region and global economic trends directly affect the banking sector's operating environment.
According to the agency’s assessment, the Russia–Ukraine war and the tensions in the Middle East are considered the most serious risks to the region’s financial stability. The document notes that these conflicts increase fluctuations in energy markets and create additional pressure on the banking sector by affecting capital flows.
S&P also emphasizes that uncertainties related to tariff policy in the United States increase risks in the global trade environment, which may create indirect impacts on the operations of EMEA region banks. Changes in global liquidity conditions indicate that the countries of the region — including banking systems financed by external debt — may face higher risks.
The report adds that the unstable dynamics of energy prices remain a key risk for the macroeconomic outlook of the EMEA region. This is assessed as one of the factors affecting asset quality and profitability in the banking sector, particularly in energy-exporting countries.
Recall that against the backdrop of all these factors, S&P upgraded the industry risk trend of Azerbaijan’s banking sector from “stable” to “positive” at the beginning of 2025.
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