Fitch lowers Vijaya Bank

Fitch Ratings said it downgraded Vijaya Bank's national long-term rating to AA-(ind) from AA(ind), along with the bank's Rs. 9 billion lower tier 2 subordinated debt to AA-(ind) from AA(ind) and Rs. 6 billion upper tier 2 subordinated debt to A-(ind) from AA-(ind).

The outlook is stable.

The downgrade reflects continued deterioration in Vijaya Bank's funding profile, which is weak compared with most Indian government banks, Fitch said.

The ratings also reflect expectations of continued weakening in the bank's asset quality and moderate capitalization, the agency said.

The bank's funding is weak and continues to deteriorate, Fitch added.

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