The Hindu Business Line : Crisil lowers outlook on 4 Citi-promoted companies

Mmbai, April 23 Crisil has lowered its outlook on the long-term ratings of Citicorp Capital Markets Limited, Citicorp Finance (India) Limited, Citicorp Maruti Finance Limited and CitiFinancial Consumer Finance India Limited to ‘negative’ from ‘stable’.

The rating factors in an assessment of the global financial sector and economic scenario (especially in the US and European markets where Citigroup has a large exposure), the continuing uncertainty in Citigroup’s earnings, and the pressure on Citigroup’s credit risk profile, said Crisil.

Ratings review

“This action is part of a re-examination by Crisil of its ratings on financial sector institutions in India that draw support from the credit strength of foreign parents,” said a press release from Crisil.

The ratings on these four companies promoted by Citigroup Inc centrally factor in the support from Citigroup. S&P has placed the Citigroup Rating on ‘CreditWatch with negative implications’.

Any change in the S&P rating could impact the long-term ratings of these four Indian subsidiaries as wellCrisil has also downgraded its ratings on the long-term debt of DSP Merrill Lynch Ltd and DSP Merrill Lynch Capital Ltd to ‘AA+’ from ‘AAA’. The outlook on these ratings is revised to ‘negative’ from ‘stable’.

Crisil said that this revised rating makes an assessment of the global financial sector and economic scenario (especially in the US market where Merrill Lynch has a large exposure), the continuing uncertainty in the earnings profile of the US broker-dealer industry, and the credit profile of Merrill Lynch.. S&P’s rating outlook on Merrill Lynch is ‘Negative’.

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