City
Epaper

Adani crisis unlikely to pose credit risk for Indian banks

By Lokmat English Desk | Updated: February 8, 2023 11:57 IST

Open in App
1 / 9
The exposure of Indian banks to the embattled Adani Group is not enough to impact their credit profiles, two rating agencies said on Tuesday, weeks after a U.S. short-seller report unleashed a brutal rout in shares of the conglomerate's businesses.
2 / 9
Investors have been worried about various banks' exposure to the group ever since late January when U.S.-based short-seller Hindenburg Research alleged improper use of offshore tax havens and stock manipulation by Adani Group.
3 / 9
The exposure of Indian banks to Adani Group is 'insufficient in itself' to present a substantial risk to the credit profiles of these lenders, Fitch Ratings said in a note.
4 / 9
Fitch estimated that loans to all Adani Group entities generally account for 0.8%-1.2% of total lending for Indian banks rated by the agency, equivalent to 7%-13% of total equity.
5 / 9
'Even in a distress scenario, it is unlikely that all of this exposure would be written down, as much of it is tied to performing projects,' it said.
6 / 9
Moody's Investors Service also made similar comments, saying the exposures are larger for public sector banks than for private sector banks, but they are smaller than 1% of total loans for most banks.
7 / 9
The risk to banks can increase, however, if Adani Group becomes more reliant on bank loans, Moody's cautioned.
8 / 9
Earlier on Tuesday, Fitch unit CreditSights said in a separate note that State Bank of India's (SBI.NS) exposure to the group is 'well-manageable' given its strong buffer of provision reserves.
9 / 9
SBI's total exposure was 0.9% of its total loan book, or around 270 billion Indian rupees ($3.26 billion), Chairman Dinesh Kumar Khara has said.
Tags: Adani GroupState Bank Of India
Open in App

Related Stories

BusinessBig Blow for Anil Ambani In SBI Fraud Case; Bombay HIgh Court Rejects Plea Of Reliance Group Chairman

BusinessMukesh Ambani Retains Top Spot as India’s Richest Man in Hurun Rich List 2025, Ahead of Gautam Adani

BusinessAamby Valley, Sahara City: Adani Group Set to Acquire Sahara's Properties

NationalBihar: Furniture Showroom Goods Worth Lakhs Gutted in Nalanda Blaze (Watch Video)

NationalVijayapura Bank Robbery: Masked Thieves Loot 12–13 Kg Gold and Rs 1 Crore Cash From SBI Branch in Karnataka

National Realted Stories

NationalBihar 2025 polls: Biggest wins, narrowest finishes and the voter turnout story

NationalSIR Phase II: Nearly 99 pc enumeration forms distributed; digitisation lags at 15.98 pc

NationalCBI arrests Railway Dy Chief Engineer, 3 others in Rs 98.8 lakh bribery case in Hajipur

NationalJKSA issues helpline numbers, cautions Kashmiri students amid rising profiling concerns after Delhi blast

NationalCash van robbery: Leads on accused have been found, says Karnataka HM Parameshwara