📈 Fitch AI Stress Test Finds Material Risks for Select Sectors Amid Broad Resilience

• Overall Assessment: Fitch Ratings' global AI Stress Test reveals broad credit resilience across most sectors over a 5-year horizon. However, AI poses a material risk of rating downgrades for a narrow band of vulnerable sub-sectors under adverse scenarios. • Sector Impact: • Resilient Sectors: ~86% of sub-sectors scored 40 or below (out of 100), indicating limited-to-no rating impact. Insurance, real estate, transportation, and natural resources are least exposed. • High-Risk Sectors: 14 sub-sectors scored 60–80, signaling potential downgrade pressures. Highest risk (score 80) is concentrated in services, particularly business process outsourcing (BPO) and outsourced production, relevant to global ICT/BPM operations. • Technology & Infrastructure: IT services, cybersecurity, data centers, semiconductors, and AI training facilities scored 60 due to high disruption or over-investment risks. • Financial Institutions: Mostly resilient (scores 0–20) due to capital buffers, regulation, and diversification, though private banking and business development companies show moderate risk (score 40). • Three Stress Scenarios: • Disruption: Business moats eroded fast; heaviest impact on BPO and IT services. • Over-Investment: Drop in AI capital flows impacts semiconductors and specialized infrastructure. • Asset Impairment: Stress from AI-exposed loan/investment portfolios. • Next Phase: Issuer-level analysis to follow across corporate, financial, and infrastructure entities.