World Economy

Indian Banks Fall in S&P Group 5

Indian Banks Fall in S&P Group 5Indian Banks Fall in S&P Group 5

The Indian banking sector has been classified under ‘Group 5’ along with countries such as Italy, Spain, Ireland, the UAE and South Africa by rating agency Standard & Poor’s on the basis of their economy and industry risk criteria, the American analysts said on Wednesday, PTI reported. Noting that the “low-income” Indian economy and the government’s limited fiscal flexibility constrain the country’s economic resilience, S&P in its “Banking Industry Country Risk Assessment: India”, however, said the medium-term outlook for growth remains healthy, which “provide sound development opportunities for Indian banks”. “We classify the banking sector of India in group ‘5’ under our Banking Industry Country Risk Assessment. The other countries in group ‘5’ are Spain, Ireland, Italy, Panama, Bermuda, Poland, Peru, Qatar, South Africa and the UAE. “The anchor for banks operating only in India is ‘bbb-’,” an S&P Global Ratings release said. “Banks’ asset quality is weak and has been deteriorating in the past four years, accentuated by historically weak foreclosure laws,” S&P said.


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