ICRA Nepal gives 'High Credit Quality’ rating to Subordinated Debenture of Nepal SBI Bank

ICRA Nepal has assigned [ICRANP] LAA (pronounced ICRA NP L Double A) to subordinated debenture program of NPR 200 million of Nepal SBI Bank Limited (SBI) The rating is considered as high credit quality rating. The rated entity carries low credit risk. According to a statement of ICRA Nepal, “The ratings reaffirmation factors in the bank’s ability to consistently maintain one of the strongest asset quality in the industry (~1% delinquencies as of mid-Jul-17, comparable to trend across last few years) along with the ability to achieve scale growth while ensuring adequate controls. The ratings also remain supported by established underwriting norms and risk management framework being practiced within the bank ,” “The ratings are however constrained by bank’s relatively lower CASA profile among top tier banks which could create pressure in maintaining competitive cost of funds (though remains better to industry) and healthy interest spreads,” reads the statement of the ICRA.