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Our Bureau

Roadshows for MTNs to begin on November 14

Bangalore , Nov. 9

Canara Bank is expected to secure rating of "Baa2" by international rating agency Moody's that is currently one notch above India's sovereign rating.

Canara Bank has informed the domestic stock exchanges that it iss also expected to secure a "BBB" rating from Fitch another international rating agency. Both these ratings put the bank in the investment grade slot. Investment grade is also the rating for Tata Steel.

The rating has been secured ahead of Canara Bank's road show for its $ 300 million medium term notes. This rating bankers said also was a precursor to an upgrade of India's sovereign rating. The sovereign rating is currently Baa3, which is speculative grade. Fitch's rating for India is "BBB-".

Dr Manoj Vaish, President and Chief Executive Officer of Dun and Bradstreet (India) Pvt Ltd said, " It is not unusual for corporates to secure ratings above the sovereign. But this is a signal that the sovereign rating itself will see upgrades."

The road show for CanBank's MTN issue will take place on November 14 and 15 in Singapore and London respectively. Bankers were already optimistic that the pricing would be favourable. Bankers said that the investment grade rating affirmed that optimism. The expected pricing for the issue is between 100-125 basis points over the London Interbank offered rate. The book runners for the issue are ABN AMRO, Citigroup, HSBC and UBS.

More Stories on : Credit Rating | Public Sector Banks

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