Friday, March 1, 2024
News

Financial market infrastructure companies poised for strong 2024 performance, Fitch Ratings affirms

   SocialTwist Tell-a-Friend    Print this Page   COMMENT

New Delhi | December 2, 2023 2:50:17 PM IST
Global financial market infrastructure companies (FMIs) are anticipated to maintain robust financial performance in 2024, according to Fitch Ratings.

The neutral outlook is driven by resilient business models, an increasing share of recurring non-volume revenue, and the overall adaptability of FMIs to market fluctuations.

Key insights indicate global exchanges will thrive on diversification into non-trading domains such as data and analytics, along with strong derivative trading volumes and a predicted modest rebound in IPOs in 2024.

While operational risks persist, tied to integration challenges from past acquisitions and the ongoing shift to cloud technology, Fitch expects certain global exchanges to deleverage in the coming year as synergies from recent acquisitions materialize.

Clearing houses are anticipated to face heightened counterparty credit risks in 2024, influenced by macroeconomic pressures on counterparty credit profiles.

However, this is expected to be mitigated by prudent margining practices and strengthened default waterfalls defining the priority of financial resources in case of a clearing member's default.

Regulatory advancements, including margining requirements and capitalization, will further support the credit profiles of clearing houses.

International central securities depositories (ICSDs) are foreseen to benefit from robust net interest income in 2024, leveraging an expected prolonged period of higher interest rates.

Despite operational challenges stemming from international sanctions and a shortened settlement cycle, ICSDs' sound risk management, operational capabilities, and solid profitability and capitalization are projected to mitigate potential risks.

In emerging markets, FMIs are expected to experience a stable operating environment in 2024. While profitability may encounter pressure due to adverse regulatory changes, especially in Latin America, Fitch deems such challenges manageable.

FMIs in emerging markets typically boast high credit ratings, reflecting resilient business profiles, consistent performance across economic cycles, and limited direct exposure to sovereign debt. (ANI)

 
  LATEST COMMENTS ()
POST YOUR COMMENT
Comments Not Available
 
POST YOUR COMMENT
 
 
TRENDING TOPICS
 
 
CITY NEWS
MORE CITIES
 
 
 
MORE BUSINESS NEWS
97.6 pcs of Rs 2000 banknotes returned b...
Analysts Predict Retik Finance (RETIK) W...
Bharat Startup Ecosystem registry opens ...
SBI report deciphers India's GDP surge a...
EdTalk World Conference 2024 New Delhi, ...
Meditation is the way for inner transfor...
More...
 
INDIA WORLD ASIA
PM Modi holds roadshow in Jharkhand's Dh...
'In last decade, urea production rose to...
'...This is what I get in return?': Utta...
PM Modi unveils several development proj...
'No bigger joke than this...' Himachal L...
'Mamata have set a standard of appeaseme...
More...    
 
 Top Stories
Vikash overcomes heart problem to r... 
Delhi Toofans' thunderous win over ... 
Abu Dhabi Desert Challenge 2024: Te... 
Korea's Kim shares first round lead... 
BAPS Hindu temple in Abu Dhabi open... 
Jitender Singh to contest Lok Sabha... 
"Change your mindset...there is no ... 
Himachal Pradesh: Newly appointed S...