ICRA assigns ‘AA+' rating to Axis Bank's Basel III Tier I bonds worth Rs500 crore

20 Sept 2022 , 01:34 PM

Axis Bank Limited informed that rating agency ICRA Limited has assigned and reaffirmed ratings for various debt instruments.

ICRA has reaffirmed the ‘ICRA AAA’ rating on Infrastructure Bonds/Debentures worth Rs29,705 crore, Basel III Tier II Bonds worth Rs16,350 crore, Basel II Lower Tier II Bonds worth Rs2,500 crore, and fixed deposit programme. The outlook on these instruments has been reaffirmed as ‘Stable’.

Further, the rating on Basel III Tier I Bonds worth Rs2,500 crore has been reaffirmed at ‘ICRA AA+’ with a Stable outlook. While ICRA has assigned an ‘ICRA AA+/Stable’ rating to Basel III Tier I Bonds worth Rs500 crore.

The rating agency has reaffirmed the ‘ICRA A1+’ rating on the certificate of deposits worth Rs60,000 crore.

The ratings of Axis Bank are backed by its strong position in the Indian financial system as the third-largest private sector bank with a 6.2% share of advances and a 5.1% share of banking system deposits, mentioned ICRA in its rating rationale.

Furthermore, overall capitalisation levels remain reasonable, while internal capital production has steadily improved as asset quality and credit costs have gradually declined.

Furthermore, Axis Bank continues to operate with significant floating/prudent provisions. This, together with a provision coverage ratio (PCR; excluding technical write-offs) of 77% as of June 30, 2022, offers enough cushion to absorb unanticipated asset quality shocks while also supporting the improvement in internal capital production, said ICRA in its rationale.

At around 1.33 PM, Axis Bank was trading at Rs812.85 apiece, up by 1.75% from its previous closing of Rs798.85 on the BSE. The scrip touched intraday high and low of Rs816 and Rs803.30 respectively.

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