Money & Banking

Share of upgraded listed debt issues at a three-year high for ICRA and Crisil in Q4 FY21: FSR

Our Bureau Mumbai | Updated on July 02, 2021

Upgraded and re-affirmed listed debt issues was 99.8% in the fourth quarter of last fiscal

The share of upgraded listed debt issues was at a three-year high for two rating agencies while the share of downgraded listed debt issues in total outstanding ratings fell in the fourth quarter of 2020-21 as against previous quarters.

This was revealed by the Financial Stability Report, July 2021 of the Reserve Bank of India.

“On an aggregate basis, the share of downgraded listed debt issues in total outstanding ratings declined significantly during the fourth quarter of 2020-21 vis-à-vis earlier quarters, while the share of upgraded listed debt issues was at a three-year high for both ICRA and CRISIL,” the FSR said.

For ICRA, upgraded and re-affirmed listed debt issues was 99.8 per cent in the fourth quarter of last fiscal while downgraded and suspended issues were 0.2 per cent. This is in contrast to just 88 per cent upgraded and re-affirmed listed debt issues in the fourth quarter of 2019-20.

Similarly, in the case of Crisil upgraded and re-affirmed listed debt issues was 99.9 per cent in the March 2021 quarter versus 91.2 per cent in the fourth quarter of 2019-20.

For Care Ratings too, upgraded and re-affirmed listed debt issues had risen to 95.2 per cent in the fourth quarter of 2020-21 as against 78 per cent in the same period in the previous fiscal.

“Out of the rating downgrades during the fourth quarter of 2020- 21, the share of the NBFC and housing finance company sectors as well as banks and financial services went down significantly as compared to the preceding quarter,” the FSR further noted.

In the quarter ended March 31, 2021, the rating downgrades for NBFCs accounted for 11.1 per cent of the overall downgrades in the quarter as against 28.6 per cent in the December 2020 quarter.

The share of banks, financial services in rating downgrades was nil in the March 2021 quarter versus 11.9 per cent in the previous quarter.

The power sector had the largest share of rating downgrades in the March 2021 quarter at 38.9 per cent as against 38.1 per cent in the previous quarter.

Published on July 02, 2021

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