ICRA downgrades long-term rating for IDFC First Bank from AA+ to AA

Rating agency ICRA has downgraded the long-term rating for IDFC First Bank from "AA+" to "AA" due to weak earnings profile. Its cost to income ratio is elevated due to ongoing branch expansion plans.

The rating action also factors in an increase in credit provisions on account of unanticipated fresh stressed exposures identified by the bank in Q4FY19, ICRA said in a statement on Tuesday.

The bank’s earnings profile remains weak, given its dependence on wholesale deposits. Despite the strong growth in current account and savings accounts (CASA) deposits, its share in overall liabilities remains low. This leads to a higher cost