Moody's lifts two Indian banks views to positive

Moody's Investors Service said it affirmed the long-term local- and foreign-currency bank deposit ratings of Central Bank of India and Indian Overseas Bank at Ba3.

The outlook was revised to positive from stable.

For Indian Overseas Bank, Moody's said it also affirmed the bank's senior unsecured debt rating at Ba3. The bank issues its senior unsecured debt out of its Hong Kong branch, the agency noted.

Thea agency also said it affirmed the both banks' baseline credit assessments at B3 and counterparty risk assessments at Ba2(cr)/NP(cr).

The positive outlook reflects the upward pressure that could develop on the banks' long-term ratings if credit fundamentals – namely their capital positions – continue to improve over the next 12 to 18 months due to capital infusions from the Indian government, Moody's said.

The positive outlook also reflects a view on the expected evolution of their balance sheets, including stabilization in asset quality, moderate improvement in profitability metrics and stable funding and liquidity positions, the agency said.

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