Moody's ups outlook on IOB and Central Bank to positive from stable

Expects moderate improvement in profitability and asset quality stabilisation

Global ratings agency Moody's has revised the outlook on two Indian public sector lenders, the Indian Overseas Bank (IOB) and Central Bank of India (CBI), from "stable" to "positive". 

The positive outlook reflects the upward pressure that could develop on the banks' long-term ratings if capital positions continue to improve over the next 12-18 months due to capital infusions from the government, Moody's said in statement on Friday.

The agency expects a stabilisation in asset quality, a moderate improvement in profitability metrics, and stable funding and liquidity positions at these two banks.

Moody's also affirmed the long-term local and foreign currency bank deposit