International ratings agency Moody's has lowered to negative, the outlook for South Africa's banking system. The agency cited deteriorating operating conditions over the next 18 months for the downgrade from stable to negative. According the annual banking system outlook "the outlook expresses Moody's expectation of how bank creditworthiness will evolve in this system over the next 12 to 18 months". It also noted that "the challenging economic outlook will strain borrowers' repayment capacity, fuelling increased asset risks". South Africa's economy, weakened by low commodity prices, drought and political disturbances, is expected to grow by less than 1 percent this year. Moody's earlier this month maintained the sovereign rating of Africa's most advanced economy at BAA2 with a negative outlook, two steps above junk.