Moody’s on IndusInd Bank and Yes Bank: Rating Review
Why in the news
Moody’s began examining IndusInd Bank’s risk management and leadership transition after derivatives accounting lapses, and also commented on Yes Bank.
Key facts
- IndusInd: derivatives losses seen as manageable given strong capital; an external agency estimated a ₹1,979 crore negative impact as of 30 June 2024.
- Rating action: BCA on review for downgrade in March 2025 over weak internal controls; long-term outlook stable.
- Current rating: Ba1 for foreign and local currency deposits.
Yes Bank
- Books cleaned up, but RoA is about 70 bps against 1.5% at comparable private banks.
- Profitability depends on raising external capital.
- After a default it was rehabilitated with new shareholders; outlook moved from stable to positive in July 2024.
Banking system outlook
Stable, helped by government capital expenditure, tax cuts and monetary easing.
Exam angle
- Agency: Moody’s; terms: BCA, RoA, review for downgrade.