Group head - financial sector ratings - Latest News Update, Information, Photos & Videos on Group head

New Delhi, Sep 17 The proposed divestment of the Centre's majority stake in certain PSBs will be credit negative for these lenders, ratings agency ICRA said on Thursday.Citing recent reports which suggest a possible divestment of majority stake in few PSBs that were left out of the PSBs consolidation exercise announced last year, ICRA said that most of these PSBs have weak credit profile and their credit ratings are primarily supported by their sovereign ownership and a stable deposit base, which in turn is supported by their ownership."The existing ratings are also notched up from the standalone credit profile and going forward, the ratings on these PSBs would reflect their standalone credit profile depending on their new ownership of these banks," it said in a statement.Furthermore, ICRA expects the deposit franchise for these banks will be monitorable as these deposits could be highly sensitive to their ownership.The ratings agency noted that the proposed divestment of these PSBs will require amendment to the Banking Companies (Acquisition And Transfer Of Undertakings) Act, 1970/1980, which mandates the Centre to hold no less than 51 per cent of the paid-up capital of these lenders.Commenting on these developments, Karthik Srinivasan, Group Head - Financial Sector Ratings, ICRA said: "The financial profile of these PSBs is very weak and the standalone profiles of these banks could be low within investment grades rating given their weak asset quality, profitability, capital and solvency profile.""The liability profile for these banks will become a key monitorable in the immediate term."( With inputs from IANS )Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor

Home

City

Latest News

Cricket

LT Premium

National

International

Maharashtra

Opinions

Chhatrapati Sambhajinagar

Nagpur

Entertainment

Photos

Business

Technology

Sports

Lifestyle

Social Viral

Lokmat Games

Health

Narendra Modi

Lok Sabha Election 2024

Heatwave In India

Mumbai Water Cut

Maharashtra Lok Sabha Election

IPL 2024

Group Head - Financial Sector RatingsFOLLOW

Group head - financial sector ratings, Latest News

Business :Govt's stake divestment to be credit negative for PSBs: ICRA

New Delhi, Sep 17 The proposed divestment of the Centre's majority stake in certain PSBs will be credit ... ...