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Shares of Axis Bank on Monday declined over 5 per cent after S&P Global Ratings lowered its ratings of the lender due to increased economic risks for banks operating in India.
The stock plunged 5.21 per cent to ₹402.90 on BSE. On NSE, it tanked 5.29 per cent to ₹402.35.
“We lowered our ratings on Axis to reflect our expectation that heightened economic risks facing India’s banking system will affect the bank’s asset quality and financial performance, S&P said on Friday.
While Axis Bank’s asset quality is superior to the Indian banking sector average, its level of non-performing assets will likely remain high compared to international peers, it noted.
The agency said economic conditions have turned adverse for Indian banks due to Covid-19 and drastic efforts to curtail the spread of the virus have resulted in a sharp economic contraction.
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