Moody's lowers SBI's debt and local currency rating to junk
Global rating firm, Moody’s Investors Service, has downgraded State Bank of India’s senior unsecured debt and local currency deposit ratings to Baa3 or lowest investment grade rating from Baa2 and altered the outlook on SBI’s financial strength rating to negative from stable as the economic slowdown impacts bank’s credit quality.
Why did Moody’s downgrade SBI’s rating?
As per rating agency, the combination of mounting pressure on credit fundamentals and the ongoing dependence on the fiscally constrained Indian government to maintain Capital Adequacy Ratio (CAR) are key players behind the rating downgrade at a level no higher than the sovereign.
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