CARE revises Punjab National Bank's Basel II Upper Tier II Bonds from to ‘CARE AA+/Stable’

The credit rating agency also revises Basel III AT1 Bonds of the company from ‘CARE AA-/Stable' to 'CARE AA/Stable’.

Nov 25, 2021 11:11 IST India Infoline News Service

CARE Ratings vide its rating action dated November 24, 2021, has revised the ratings on Punjab National Bank's Basel II Upper Tier II Bonds from ‘CARE AA/Stable’ to ‘CARE AA+/Stable’ and Basel III AT1 Bonds from ‘CARE AA-/Stable' to 'CARE AA/Stable’.

Further, it has reaffirmed the ratings on Infrastructure Bonds, Basel II Lower Tier II Bonds & Basel III Tier II Bonds at 'CARE AA+/Stable', Basel II Perpetual Bonds at 'CARE AA/Stable' and Certificate of Deposits at 'CARE A1+'

“The ratings assigned to the various debt instruments of Punjab National Bank (PNB) factor in majority ownership, demonstrated and expected continued support from the Government of India (GoI), PNB’s systemic importance and position in the Indian banking sector being the second-largest public sector bank in terms of business and asset size. The rating continues to derive strength from its strong and established franchise through pan India branch network which helps it to garner low cost and stable Current Account Savings Account (CASA) deposit base with comfortable liquidity and making the liability profile of PNB strong.

Post the merger of United Bank of India (UBI) and Oriental Bank of Commerce (OBC) (w.e.f. April 01, 2020), the bank has raised equity capital which has improved the capitalisation levels of the bank enhancing its ability to absorb asset quality pressures as well as support growth in the near term.

At around 11.57 am, Punjab National Bank was trading at Rs40 per piece down by Rs0.5 or 1.23% from its previous closing of Rs40.50 per piece on the BSE.

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