Standard and Poor’s (S&P) assigned Stable Outlook to 10 Indian Banks

Credit rating agency Standard and Poor’s (S&P) assigned stable outlook to 10 Indian banks and kept their long term and short-term issuer credit rating (ICR) at BBB- and A-3.

As per S&P’s ratings definition, BBB- denotes a long-term issue rating that exhibits adequate protection parameters but shows a weakened capacity to meet obligations under adverse economic conditions. A-3 on the other hand is a short-term issue rating that exhibits adequate protection parameters but shows a weakened capacity to meet obligations under adverse economic conditions.

Out of the top four Indian Banks in the list, S&P rated HDFC Bank highest on standalone credit profile (SACP) and offered it BBB+ while giving a BBB- to Axis Bank. State Bank of India (SBI) and ICICI Bank were assigned BBB.

HDFC Bank’s business position was rated as strong, its capital and earnings and risk position were rated adequate, and its funding and liquidity position was concluded to be above average and strong. Customer deposits represent more than 90 per cent of HDFC’s funding base. Its savings and current deposits, which are inherently low cost and stable, have been stable at about 50 per cent of the bank’s deposit base. Also HDFC’s liquidity ratios were found to be noticeably stronger compared to the other players’.