Alka Anbarasu, associated managing director, said that the positive perspective of the “BA3” qualification of Yes Bank is related to improvements in his credit profile | Photo credit: Dhiraj Singh
The Moody’s Investor Service said that the bank’s capacity to improve its profitability and increase capital are key monitor equally, since Indusind Bank’s risk management chapters are being closely monitored in the context of derivative losses.
To a specific question about the view of the global qualification agencies about the banks mentioned above, Alda Anbarasu, associated managing director, Moody’s remarkable perspective on the “BA3” qualification of Yes Bank is related to improvements in his credit profile.
It is considered that the qualified debt obligations have speculative elements and are subject to a substantial credit risk.
“So, clearly the bank has been rehabilitated, with the new shareholders entering, after breach of that place of Toks a few years ago. We see that LEGOCY OP OLD’s book has the place of tasks.
“But the monitorable for the qualification of Yes Bank, which has a positive perspective, is really its ability to improve its profitability. Profitability rows quite low. It has also revealed the results of the full year, but traction in profitability.
Profitability is an area that Moody’s is watching because it has a link with the bank’s ability to raise external capital.
Anbarasu said that the return of the assets of Yes Bank (Roa) was around 60 bp (0.60 percent) in fiscal year 2015 (30 bp in fiscal year 2014). But the same for other comparable private sector banks was 150 bp.
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The Moody official observed that Indusind Bank is in a different phase at this time. His qualification, which is two notches above Yes Banks, was a recent affirmed in “BA1”, with stable perspectives.
However, the agency has placed the Indusind Bank’s independent credit profile under a reduction review.
Anbarasu said that this reflects the results or operational failures that the bank has revealed to the market in terms of derivatives.
“But more than the financial impact of these operational failures, I believe that the area we are reviewing is the impact on, for example, bank risk management and the ability to control the risk.
“The financial impact of derivative losses is renounceable, considering the strong capital of the bank.
The agency will continue to observe some of the developments that its analysts think they are relevant to the qualification and, consequently, return to the markets.
Anbarasu emphasized that any transition of management equipment in the bank also remains monitorable. But all this is reduced to risk management and the agency would review it in that context.
Posted on April 23, 2025