Credit rating agencies News

The regulator's move comes against the backdrop of rising instances of debt defaults and concerns over the role of credit rating agencies in assessing the possible risks.

The proposed norms are likely to have an impact on global rating agencies like S&P, Moody's and Fitch which have significant holdings in domestic agencies besides their direct presence.

Capital market regulator Sebi on Monday said it is "not happy" with the current state of affairs at credit rating agencies and will soon float a discussion paper for a new set of norms for them.

Regulator Sebi is looking to review the framework for credit rating agencies as it seeks to check the menace of 'rating shopping' and pick-and-choose approach in their actions.

India Inc's credit profile was at its strongest last fiscal with less than 10 percent of the corporate debt securities rated as unsafe for investment -- the lowest level so far for such issues.

The government is likely to achieve its fiscal deficit target of 3.5 percent of GDP in the current fiscal but higher infrastructure spending will limit the room to reduce it further to 3 percent in 2017-18, Moody's said today.

Markets regulator SEBI Tuesday came out with stricter disclosure requirements for credit rating agencies to ensure more transparency in their policies amid instances of drastic downgrades impacting investors.

As part of efforts to rein in soaring bad loans and restructuring of assets, banks should upgrade skills for greater due diligence to evaluate credit ratings, which need to be treated as "opinion" rather than "gospel truth", says a study.  

 India Inc's credit profile was at its best last financial year with over 89 percent of its debt securities being rated as safe for investment -- a record high for such issues.

 Concerned over severe spill-over impact of recent drastic downgrades by rating agencies, market regulator Sebi plans to strengthen its disclosure guidelines for issuance and review of the ratings by such entities.

BSNL said that it has got its long term loan rated by CARE to comply with the condition of public sector banks.

The new RBI guidelines will allow banks to acquire majority equity stakes in corporates that are unable to honour their debt commitments. And acquiring a majority stake would make it easier for the banks to install new company management.

"We consider that IDBI Bank's standalone credit profile continues to be negatively impacted by its asset quality issues. Its impaired loan ratio rose to 14.7 percent at end-March 2015 as against 12.16 percent a year earlier," it said.