Page 2 - Fitch

Indian banks' Viability Ratings to benefit from improved performance: Fitch

Indian banks' Viability Ratings (VR) will continue to benefit from improved operating conditions and performance in the near term, said a global rating agency. "We expect Issuer Default Ratings (IDRs) to remain stable across banks as they are driven by our expectation of extraordinary support from the Indian sovereign (BBB-/Stable), should there be a need," Fitch Ratings said in a statement. Two Indian banks' VRs were upgraded in 2023, with upside possible for several banks as Fitch expects the recent, better-than-expected, financial performance, mainly in asset quality and earnings, to be maintained, it said. The recent revision of the operating environment score to 'bb+' from 'bb' also supports the assessment, it said. Five of the eight Indian banks' VRs are in the 'bb' category, reflecting a moderate degree of financial strength, while the other three with VRs in the 'b' category are still weighed down by their risk profiles, weak financial metrics of the past and weaker ...

Fitch upgrades India's medium-term GDP growth projection to 6.2%

The ten emerging economies include Brazil, China, India, Indonesia, Korea, Mexico, Poland, Russia, South Africa, and Turkey

Fitch upgrades India's mid-term GDP growth forecast to 6.2% from 5.5%

Fitch blamed China for pulling down the estimate of 10 emerging countries to 4 per cent from 4.3 per cent earlier

Rising ownership costs to hurt commercial vehicle volume growth: Fitch

The ratings agency said increasing regulatory requirements, elevated inflation and high interest rates have pushed up the ownership costs, thereby weighing on purchase decisions

Fitch affirms SBI's long term rating at 'BBB' on asset quality, loans

Agency revises outlook for lender's asset quality score from 'stable' to 'positive'

FPIs withdraw Rs 2,000 cr in first week of Aug due to Fitch downgrading

After five months of sustained buying, foreign investors have turned net sellers and pulled out over Rs 2,000 crore from the Indian equities in the first week of August, mainly due to Fitch downgrading the credit rating for the US. In addition, the rich and stretched valuations and minor profit booking could be the reasons for this outflow, Yes Securities Chief Investment Advisor Nitasha Shankar said. "A sharp spike in the US 10-year bond yield above 4 per cent is a near-term negative for capital flows to emerging markets," Geojit Financial Services Chief Investment Strategist VK Vijayakumar said. If the US bond yields remain high, FPIs are likely to continue selling or at least refrain from buying, he added. According to the data with the depositories, Foreign Portfolio Investors (FPIs) withdrew a net sum of Rs 2,034 crore from Indian equities during August 1-5. This came after unabated net inflow in the past five months -- from March to July -- following the resilience of the In

Fitch Ratings downgrades US: A stern criticism of political standoffs

The Fed raised interest rates by 25 bps in March, May, and July 2023. Fitch expects one more hike to 5.5 per cent-5.75 per cent by September

Fitch downgrades US credit rating to AA+, Treasury calls it 'arbitrary'

Fitch downgraded the United States to AA+ from AAA, citing fiscal deterioration over the next three years and repeated down-the-wire debt ceiling negotiations

US ratings downgrade puts focus on remaining nations with top credit grade

Countries with highest credit rating at S&P Global Ratings, Fitch and Moody's Investors Service include Germany, Denmark, Netherlands, Sweden, Norway, Switzerland, Luxembourg, Singapore and Australia

Top headlines: Fitch cuts US credit rating, corporation tax mop-up slips

Business Standard brings you the top headlines at this hour

Rising risk appetite may affect some Banks' credit profiles: Fitch

Banks' loan growth over the financial year ended March 2023 (FY23) reached 15.4 per cent, the highest since FY12

Revised gas pricing formula to aid profit stability for producers: Fitch

The government's decision to limit prices of domestic natural gas from legacy fields to between USD 4-6.5 per million British Thermal Unit (mmbtu) will support margins for city gas distributors, encourage the use of gas, and reduce cash flow volatility for upstream producers, Fitch Ratings said on Wednesday. "We expect a partial pass-through of the lower administered price mechanism (APM) gas prices, at which domestic upstream producers supply gas to city gas distributors, in the prices of compressed natural gas (CNG) and domestic piped natural gas (PNG) to add to the distributors' margins in the near term," it said in a statement. City gas retailers like Indraprastha Gas Ltd and Adani Total Gas Ltd last weekend announced Rs 6-8 cut in CNG and PNG prices, reflecting the cut in input gas prices. The APM price under the new regime was calculated at USD 7.92, but is capped at USD 6.5 for the rest of April, 24 per cent below levels in October 2022-March 2023. "We expect such price cuts

Indian corporates likely to see 10%-12% capex growth in FY24: Fitch

The rising capital expenditure trend of Indian corporates is likely to continue and grow at 10%-12% a year during the next fiscal year to March 2024, Fitch Ratings said in a release on Tuesday

Fitch Solutions sees raw sugar prices averaging 2% higher in 2023

Fitch Solutions said it sees raw sugar prices averaging 2% higher this year as production will likely disappoint in various regions including Europe and India, while demand in China should recover

Banks' improving performance supports intrinsic creditworthiness: Fitch

A sustained improvement in the financial performance of Indian banks bodes well for the sector's intrinsic risk profiles, according to global rating agency Fitch. The pace of asset quality and profitability improvement has exceeded expectations, while capital buffers are broadly in line with the projections, it said in a statement. The sector's impaired-loan ratio declined to 4.5 per cent in the first nine months of financial year ended March 2023 (9MFY23), from 6 per cent at FY'22, it said, adding, this was nearly 60 basis points below Fitch's FY23 estimate. Increased write-offs have been a key factor, but higher loan growth, supported by lower slippages and improved recoveries, have also played a role, it said. Fitch expects a further improvement by FY23, although banks still face the risk of asset-quality pressure associated with the unwinding of loan forbearance in FY24. "The sector's improving provision cover (9MFY23: 75 per cent, FY22: 71 per cent) also supports banks' abili

Marginal pressure on banks next fiscal, net interest margin may fall: Fitch

Banks will face margin pressure next fiscal as they increase the deposit rates to attract funds to support sustained high loan growth, and the same will fall by 10 basis points to 3.45 per cent, a global rating agency said on Monday. "We expect the domestic banking sector's average net interest margin to slightly contract by about 10 bps (basis points) in FY24 to 3.45 per cent, following a 15 bps increase in FY23 to 3.55 per cent, in a base case scenario, but remain well above that during FY17-FY22 average of 3.1 per cent," Fitch Ratings said in a report. However, the 10 bps likely reduction in margin is unlikely to affect banks' profitability in the near term. Higher fee income -- stemming from higher loan growth -- and a revival in treasury gains should broadly counterbalance the twin pressures of higher credit costs and funding costs in FY24, while supporting capitalisation. This contraction is consistent with the lagged normalisation in deposit rates, although banks should be ab

No immediate impact from Hindenburg on Adani firms' credit profiles: Fitch

Rating agency will be monitoring group firms closely for major changes in their access to finance, the cost of financing, regulatory/legal developments and ESG-related matters

Fitch expects windfall tax to be phased out in 2023 on moderating oil rates

Fitch Ratings on Tuesday said it expects the five-month-old tax on windfall profits made by oil companies to be phased out in 2023 on the back of moderating oil rates. The government had on July 1 levied a new tax on domestically-produced crude oil as well as on the export of petrol, diesel and jet fuel (ATF) to take away windfall gains accruing to oil companies from a global surge in energy prices following Russian invasion of Ukraine. The tax rates are revised every fortnight based on prevailing international rates. The levy on petrol export has since been abolished. "We expect the windfall taxes on domestic crude oil production levied by the government in 2022 to be phased out in 2023 with moderating prices," Fitch said in its APAC Oil & Gas Outlook 2023. Domestically-produced crude oil, which makes up for 15 per cent of all oil consumed in the country, is priced at international rates. With global oil prices rallying to a decade high in the aftermath of the Russia-Ukraine war,

South Indian Bank's move on tier-2 bond won't disrupt sector: Fitch

Lender decision to not redeem the bonds does not indicate any weakness in capital position, says ratings agency

Excess credit growth to limit Indian banks' loss-absorbing ability: Fitch

Rating agency warns capital base of PSBs may come under greater strain