The broader iShares Global Financials ETF (NYSEArca: IXG), which includes global financial companies, is up more than 8% this year, but there are some potential ratings risks looming for select global banks.

IXG is a global exchange traded fund so it contains hefty exposure to domestic banks, but some European markets could pressure the ratings outlook for banks in markets outside the U.S.

“The number of bank ratings on Negative Outlook has increased since the middle of last year,” said Fitch Ratings in a recent note. “The share of Negative Outlooks globally rose to 13% at end-2018 from 10% at end-1H18, following sovereign-driven Outlook revisions in Italy and Latin America, while the share of Positive Outlooks decreased slightly to 7% (end-1H18: 8%).”

Emerging markets banks could potentially be ratings trouble spots.

“Emerging Markets Americas had the highest proportion of Negative Outlooks at end-2018 (29%), with banks in Argentina and Mexico accounting for half of these,” according to Fitch.

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