Fitch Ratings on Wednesday revised the rating outlook to stable from negative for nine India-based banks, including SBI, ICICI Bank and Axis Bank.
The other lenders are Bank of Baroda (BOB), Bank of Baroda (New Zealand) Ltd, Bank of India, Canara Bank, Punjab National Bank (PNB) and Union Bank of India.
“Fitch Ratings has revised the Outlook to Stable from Negative on the Long-Term Issuer Default Ratings (IDR) of 9 India-based banks, while affirming their IDRs,” Fitch said in a statement.
The IDRs are based on Fitch’s assessment of high to moderate probability of extraordinary state support for these banks, which takes into account its assessment of the sovereign’s ability and propensity to provide extraordinary support.
It factors in the government’s consistent record of supporting systemically important banks, the lenders’ relative systemic importance and their different ownership, Fitch said.
Separately, Fitch also revised the outlook on Export-Import Bank of India’s (EXIM) Long-Term IDR to stable from negative.
These rating actions follow Fitch’s revision of the outlook on the ‘BBB-‘ rating on India to stable from negative last week due to diminished downside risks to the country’s medium-term growth, which is underscored by its rapid economic recovery and easing financial sector weaknesses.