Moody's downgrades deposit ratings, credit assessment of four PSU banks

Says economic shock from Covid-19 may weaken borrower credit profiles and hurt their asset quality. outlook on ratings of all four is negative

Global rating agency Moody’s downgraded the long-term local and foreign currency deposit ratings of four public sector banks — Bank of Baroda, Bank of India, Canara Bank, and Union Bank of India — from “Baa3” to “Ba1”.

It also downgraded Baseline Credit Assessments (BCAs) from “Ba3” to “b1” for these four PSBs as the economic shock from the Covid-19 pandemic might weaken borrower credit profiles and hurt the banks’ asset quality. The outlook on the ratings of the four banks is negative.

Meanwhile, Moody’s affirmed Punjab National Bank’s long-term local and foreign currency deposit ratings at “Ba1” and its BCA at “b1”.