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Indian banks are most vulnerable in Asia-Pacific economies, says Moody's

Banks in India risk seeing their capital severely depleted if there is a rise in corporate defaults, warned global rating agency Moody's

Public sector banks
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Illustration by Binay Sinha

Anup Roy Mumbai
Banks in India risk seeing their capital severely depleted if there is a rise in corporate defaults, warned global rating agency Moody’s.

“Indian banks are the most vulnerable because they have lower capital ratios, and their capital will be wiped out under our stress scenario,” Moody’s said, analysing banks in 13 Asia Pacific economies.

A prolonged period of low interest rates has resulted in companies building up leverage, which is hurting them now, in times of low economic growth coupled with growing trade and geopolitical tensions.

Most banks in the region have a good capital buffer, but those in India

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First Published: Sep 30 2019 | 10:36 PM IST

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