Dena Bank’s profitability may fall further in FY14 due to increased funding cost and mark-to market losses on investments, according to India Ratings and Research.
The higher provisioning costs for restructured assets could exert additional pressure on profitability. The Mumbai-based public sector lender’s return on assets declined to 0.8 per cent in FY13 from 1.1 per cent in FY12.
The rating agency affirmed Dena Bank's long-term issuer rating at ‘IND AA-’ with a stable outlook.
The agency has also affirmed Dena’s Tier 2 subordinated bonds at ‘IND AA-’ and its upper tier 2 subordinated bonds and perpetual debt instruments at ‘IND A-’.
