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Rating agency ICRA, on Tuesday, downgraded the long-term ratings of IDFC First Bank after the lender posted weak results.
“The rating downgrade considers IDFC First Bank’s weak earnings profile, given the elevated cost-to-income ratio because of the ongoing branch expansion, which has been pressurising the operating profitability, and an increase in credit provisions on account of unanticipated fresh stressed exposures identified by the bank in the fourth quarter of 2018-19,” it said in a statement.
The rating agency has downgraded the private sector lender’s non-convertible debentures worth over ₹38,000 crore to AA stable from AA+ stable.
This includes ₹28,689.73 crore of NCDs of the erstwhile Capital First and Capital First Home Finance, and another ₹10,000 crore of NCDs of the former IDFC Bank.
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