Moody's upgrades ratings of Shriram Transport Finance's securitised loans

KOLKATA: Moody's Investors Service has upgraded the ratings assigned to Shriram Transport Finance Company's all outstanding securitised loans, making the instruments higher rated than India's sovereign rating.

The ratings assigned to pass-through certificates (PTCs) of 10 auto asset backed securities (ABS) transactions have been upgraded to Baa2 from Baa3 earlier. Ratings of another three auto ABS transactions have been upgraded to Baa1 from Baa3.

India's sovereign rating is Baa3 with positive outlook. This is the lowest level in investment grade.

Moody's said it decision to upgrade rating was prompted by a lowering of the operational risk assessment related to these transactions.

The three transactions which have been upgraded to Baa1 was on account of a rise in the available credit enhancement. Moody's has observed that the portfolios backing the three transactions have continued to exhibit low rates of delinquency over 90 days, even during the period immediately following the demonetisation.