Fitch Ratings has changed the outlook on several Philippine banking institutions’ credit ratings to negative.

Fitch’s recent action on Tuesday impacted the Land Bank of the Philippines (LandBank), Bank of the Philippine Islands (BPI), Philippine National Bank (PNB), Development Bank of the Philippines (DBP), BDO Unibank Inc., and Metropolitan Bank and Trust Co. (Metrobank).

The credit rating agency said in a statement on Tuesday that the negative outlook on LandBank’s ‘BBB’ rating reflects its “assessment of the state’s weakening ability to support the bank.”

Fitch’s assessment of the government’s “deteriorating fiscal flexibility to support the bank” is reflected in the negative outlook on Ayala-led BPI’s ‘BBB-‘ rating.

According to the debt watcher, the negative outlook on Tan-led PNB’s ‘BB’ rating “mirrors that of the sovereign and also reflects sustained challenges in the operating environment, which would continue to weigh on the bank’s credit profile over the rating horizon.”

The negative outlook on the government-run DBP’s ‘BBB-‘ rating reflects Fitch’s “assessment of the state’s weakening ability to support the bank, as indicated in the sovereign rating,” according to the credit rater.

Fitch’s “assessment of the state’s weakening ability to support the bank, as indicated in the sovereign rating” has resulted in a negative outlook on Sy-led BDO’s ‘BBB-‘ rating.

Finally, the credit watchdog said that Metrobank’s ‘BBB-‘ rating has a negative outlook because of its “assessment that the sovereign’s ability to support the bank has deteriorated, as reflected in the Philippine’s sovereign rating.”

It said the negative outlooks follow a similar downward revision in the Philippines’ sovereign rating outlook on July 12, reflecting increased risks to the country’s credit profile from the impact of the coronavirus disease 2019 pandemic and its aftermath on policy-making, economic and fiscal outcomes.

According to Fitch, the Philippines’ medium-term economic prospects are at risk due to likely scarring effects and issues connected with unwinding the unprecedented policy response to the health crisis and restoring healthy public finances once the pandemic has passed.