Moody’s might lift IDBI Bank

Moody's Investors Service said it placed on review for upgrade all long-term ratings of IDBI Bank Ltd. and all long-term ratings of the bank's IDBI Bank Ltd., DIFC Branch.

The agency also placed on review for upgrade the baseline credit assessment and adjusted baseline credit assessment of IDBI, and the long-term counterparty risk assessment of IDBI and its DIFC branch.

At the same time, Moody's affirmed all short-term ratings of the bank and its DIFC branch.

The outlooks were changed to ratings under review.

Moody’s said the primary driver for the review is the announcement by IDBI Bank that Life Insurance Corp. of India has expressed interest in acquiring a 51% controlling stake in the bank through the preferential allotment of shares/an open offer.

The review for upgrade will focus on the exact amount of fresh equity that Life Insurance will inject into the bank and its impact on IDBI's capitalization, and the presence of any regulatory limitations on Life Insurance’s ability to provide further support, and particularly on its ability to raise its stake above 51%, the agency said.

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