Fitch downgrades SBI, BoB viability rating as asset quality deteriorates

The banks' core capital buffers appear more vulnerable to moderate shocks, the rating agency says

Global rating agency Fitch ratings has downgraded viability rating by one notch for State Bank of India and Bank of Baroda, on weakened intrinsic risk profile. 

The profiles of the two banks have been impacted due to negative effect of persistently poor asset quality and earnings on their capital position. The banks' core capital buffers also appear more vulnerable to moderate shocks, Fitch said in a statement on Wednesday.

Fitch affirmed the 'BBB' Long-Term Issuer Default Ratings (IDRs) for five Indian banks: State Bank of India (SBI), Bank of Baroda (BoB), Bank of Baroda (New Zealand) Limited (BoB NZ), Canara Bank (Canara)