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S&P upgrades Axis Bank’s ratings
November 22, 2022
It also raised its long-term and short-term issuer credit rating on the lender to ‘BBB-/A-3’ from ‘BB+/B’. They kept outlook ‘Stable’ for the bank.
“Our upgrade reflects Axis Bank’s good asset quality and our expectation that the bank will maintain that over the next one to two years. India’s robust economic growth should support borrowers’ creditworthiness,” the ratings agency said in a press release.
On the stable outlook front, S&P Global said Axis Bank will maintain its strong market position in India’s banking sector over the next two years. The bank’s capitalization should stay comfortable, notwithstanding an expected decline from the acquisition of Citigroup Inc.’s retail portfolio in India.
The ratings agency predicts Axis Bank’s weak loans, defined as nonperforming loans and standard restructured loans including loans restructured due to COVID, could decline to 2.5 percent-3.0 percent of total customer loans by end-March 2023, from 3.7 percent as of March 31, 2022.
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