The UK banking sector has a “stable” outlook, in spite of an expected decline in economic growth, according to Moody’s Investors Service.

The ratings agency added that British banks have grown more resilient to shocks despite the likelihood of Brexit turbulence facing the sector.

The comments came as Spanish lender Banco Santander warned that the uncertainty surrounding Brexit is likely to have an adverse effect on British banks operations. In a filing to the US Securities and Exchange Commission, the bank stated the lack of clarity on the Brexit deal for financial services and the status of European citizens in the UK would have a “significant” effect on its operating results and its ability to hire and retain employees.

However, Moody’s has said that profitability for British banks will improve over the next year in the absence of large fines and legal action which have branded the decade since the financial crisis.

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