Suryoday Small Finance Bank obtains A1+ rating from ICRA

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Suryoday Small Finance Bank (SSFB) said on Friday that rating agency ICRA had assigned it A1+ credit ratings for an increased amount of certificate of deposit program ratings.

“The stable outlook reflects ICRA’s expectation that the bank will continue to maintain its medium-term credit profile and see improved profitability helped by the experienced management team, strong capitalization profile, traction healthy deposits and financial flexibility,” the bank said in its statement.

The ICRA rating took into account the role of the bank’s board of directors and its management team in scaling up its operations as they gradually diversified its product offerings, as well as the capitalization profile of SSFB with a capital adequacy ratio (CAR) of 41.4% (Tier I: 37.8%) as at 31 December 2021.

The ratings also take into account SSFB’s good deposit mobilization traction, with deposits representing 58% of its total borrowings as of December 31, 2021,” the bank said, adding that the current capitalization profile is comfortable for purposes. the bank’s short-term growth.

SSFB reported that the share of Current Account Savings Accounts (CASA) improved to ~19% as of Dec 31, 2021 from 15% as of March 31, 2021 and reduced the share of bulk deposits and gradually establishes a stable retail depositor base.

“The ratings also take into account the bank’s strong liquidity profile and financial flexibility. SSFB maintained high liquidity on the books in fiscal 2021 and the 9 months of fiscal 2022. Additionally, its liquidity coverage ratio of 223% for the quarter ended December 31, 2021 was well above the regulatory requirement of 100%. SSFB has access to funding from financial institutions (FIs), which further strengthens its liquidity profile. It has also raised funds under the Special Long-Term Repo Operations (SLTRO) program of the Reserve Bank of India (RBI) in the 9 months of the financial year 2022,” the bank said.

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