SBI, PNB, BoB end lower on downgrade by global agencies

MUMBAI: SBI, BoB and PNB scrips today closed as much as 1.3 per cent lower after two global agencies - Moody's and Fitch - downgraded the debt rating of the country's top three public sector banks.

SBI scrip was down 0.33 per cent lower at Rs 1,647.05 on the BSE.

Moody's had yesterday slashed SBI's senior unsecured debt and local currency deposit rating by a notch to Baa3 from Baa2, citing asset quality and recapitalisation concerns.

PNB shares fell by 0.04 per cent to Rs 483.85, while BoB settled the day with a loss of 1.30 per cent at Rs 504.75.

These stocks had lost over 3 per cent in morning trade. Fitch Ratings yesterday downgraded the viability ratings of Punjab National Bank (PNB) and Bank of Baroda (BoB) by one notch to 'bb+' from 'bbb-' but retained their long-term issuer default ratings at 'bbb-'.

"A combination of increasing pressure on credit fundamentals and ongoing reliance on fiscally constrained government to maintain capital at levels desired by regulators argue for appropriateness of supported debt and deposit ratings of SBI at a level no higher than the sovereign," Moody's had said in a late evening statement yesterday.

State Bank of India's revised rating for the senior unsecured debt and local currency deposit instruments would now be Baa3 from the earlier Baa2, Moody's said, while revising down its outlook on the bank's financial strength rating to negative from stable.