S&P: Merger has no affect on Icici Bank ratings

Standard & Poor's said that its foreign-currency ratings and outlook on Icici Bank Ltd. (BB+/positive/B) are not affected by the bank's announcement of a proposed merger with Sangli Bank Ltd.

Through the merger, Icici Bank will acquire Sangli Bank's network of over 190 branches and existing customer base across urban and rural centers, primarily in the Indian states of Maharashtra and Karnataka. This will reinforce Icici Bank's focus on rural and small enterprise banking operations in the two states, S&P said.

The proposed merger would result in the issuance of additional equity shares of Icici Bank, equivalent to about 0.4% of its existing issued equity share capital. Although the financial profile of Sangli Bank is weak, as evident in its capitalization and profitability, this merger will not have any material impact on Icici Bank's financial profile, the agency said.

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