Financial Daily from THE HINDU group of publications
Friday, Dec 16, 2005


News
Features
Stocks
Shipping
Archives
Google

Group Sites

Money & Banking - Credit Rating


Fitch upgrades ratings for SBI, ICICI Bank

Our Bureau

Mumbai , Dec. 15

INTERNATIONAL rating agency Fitch Ratings upgraded individual ratings for ICICI Bank and State Bank of India to `C' from `C/D'.

The rating agency also affirmed other ratings of both banks at long-term foreign currency `BB+', short-term foreign currency `B', national long-term `AAA (ind)' and support `3'.

The outlook on the ratings is stable for both banks, a press release from the agency said.

According to Fitch, the individual rating for SBI recognises the considerable progress the bank has achieved in strengthening its balance sheet and reflects a significant improvement in its asset quality and solvency indicators such as net non-performing loan (NPL) to loan ratio, compared with that two to three years ago.

SBI's recent push into consumer banking, which now is at 25 per cent of total loans, has also diversified its loan book from a predominant corporate exposure previously.

The focus on the consumer segment also opens up new opportunities for cross-selling, which should help the bank further improve its fee income.

In the case of ICICI Bank, Fitch said the upgrade of the individual rating reflected the bank's improved financial condition over the past two to three years, particularly when compared with ICICI Ltd, primarily a project financing institution at that time.

At the same time, the rating agency also expressed some concerns on the bank's explosive growth in consumer loans, which have increased 10-fold during the last three years and constituted about 63 per cent of total loans as on June 2005.

However, such risks are somewhat reduced due to the continued low levels of penetration in the consumer banking sector in India, the fact that more than 90 per cent of ICICI's consumer assets are secured and that the buoyant economic conditions in India appear to continue for at least another one to two years, the release said.

More Stories on : Credit Rating

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page



Stories in this Section
IL&FS Investsmart raises $90 m through GDR


RBI board meets chiefs of RRBs
Rupee rises further; bond prices edge up
Laser Soft in talks with SIs
SBI car loan carnival
SBI insurance ads up to life
ING Vysya Life to support hockey
Crop insurance mooted for coconut farmers
Fitch upgrades ratings for SBI, ICICI Bank
Expert group moots checks to prevent abuse of FII route
SEBI uncovers scam in YES Bank IPO allotment — Bans 13 investors from trading
Modus operandi in YES Bank deal
ICICI Bank to focus on retail-led growth
HDFC Bank launches credit card for farmers
Corporation Bank gearing for growth via acquisitions — CRAR at a high 17 per cent
PNB hands over dividend to govt
PNB customers' meet
No pressure on interest rates for now: Kamath
T-bills auction fully subscribed
KBOO meet at Mangalore on Dec 18


The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |

Copyright 2005, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line