S&P rates Indian banks a notch higher than China

Global rating agency Standard & Poor's has placed Indian banking system on a higher plane than that of China.

In its latest research report "Banking industry country risk: These are the good old days," released today, the agency has studied the banking system of 60 countries. India has been placed in Group 6 while China has been placed in Group 7.

Banking industry country risk analysis is an integral part of the approach to estimate the probability of a banking crisis and the potential depth of damage of a crisis.

In order to enhance the effectiveness of the research and tie it to bank credit ratings, Standard & Poor's has synthesised this wide-ranging analysis into a single "banking industry country risk assessment", or BICRA, which reflects the strengths and weakness of a country's banking system relative to other countries.

BICRA classify countries into 10 groups ranging from the strongest banking systems (group 1) to the weakest (group 10) from a credit perspective. India shares the group with Lithuania, Poland, Thailand, Trinadad & Tobago, Bahrin, Brazil, Coratia, Bulgaria, Cyprus and Hungary.

Latvia, Panama and Turkey are with China in Group 7. Pakistan is placed in Group 8 along with the Philippines, Indonesia and a few others.