Fitch affirms Bank of Baroda, subsidiary at 'BBB-' with stable outlook

Action factors in a high likelihood of sovereign support to the public sector lender; rating agency says profitability to rise further; high loan growth to resume

Fitch Ratings has affirmed Bank of Baroda's (BoB) and its subsidiary Bank of Baroda (New Zealand) Ltd’s long-Term Issuer Default Ratings (IDRs) at 'BBB-'. The outlook is stable.

The rating action on the public sector lender factors in a high likelihood of sovereign (Government of India) support to the bank in times of need. The expectation of support stems from BoB's large market position with over six per cent market share in sector assets and deposits, and 64 per cent state ownership. BoB also plays a quasi-policy role through social lending.

Fitch has also reassessed the earnings and profitability score