Fitch ups IDBI Bank

Fitch Ratings said it upgraded IDBI Bank Ltd.'s national long-term deposit rating to tAAA(ind) from tAA+(ind), and affirmed its national long-term rating at AA+(ind) and Rs. 3.5 billion upper tier 2 subordinated bond program at AA-(ind). Fitch also said it affirmed the bank's national short-term rating at F1+(ind), long-term foreign-currency issuer default rating at BBB-, short-term foreign-currency issuer default rating at F3.

The agency also said it assigned an F1+(ind) rating to its Rs. 160 billion certificates of deposit program.

The outlook is stable.

The increased branch network and the consequent drive for customer deposits have improved IDBI's funding profile, Fitch said.

While the bank's reliance on wholesale deposits remains higher than other government banks, the sustained increase in its absolute current account and saving account deposits is encouraging and is expected to be sustained, Fitch said.

This improved liquidity and increased diversification in the bank's funding profile underpinned the upgrade of the long-term deposit rating, the agency said.

The bank's standalone credit profile, though improving, still lags that of the best government banks in India, Fitch added.

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