S&P downgrades Axis Bank's issuer rating over risks to Indian banking

Affirming the ratings on 7 other Indian banks, the rating agency said that it expected a very high likelihood of government support underpinning its ratings on government-owned banks

Rating agency Standard and Poor’s has downgraded the issuer rating of Axis Bank from “BBB-” to “BB+”, expecting that the heightened economic risks facing India’s banking system will affect the lender’s asset quality and financial performance.

At the same time, it placed ratings of public sector lender Indian Bank (BBB-) on credit watch with negative implications.

The public sector bank’s credit profile could weaken over the coming quarters due to Covid-19 as well as merger with the weaker Allahabad Bank, S&P said in a statement.

It affirmed ratings