STATE BANK OF INDIA
Fitch Ratings has assigned
The notes will constitute SBI's direct, unconditional, unsubordinated and unsecured obligations and will at all times rank pari passu among themselves and with all of SBI's other unsubordinated and unsecured obligations. The notes will be issued by SBI's
The final rating is subject to the receipt of final documentation conforming to information already received.
Key Rating Drivers
The senior unsecured instruments are rated at the same level as the bank's Long-Term Issuer Default Rating (IDR), in line with Fitch's criteria.
SBI's IDR is driven by its Government Support Rating (GSR) of 'bbb-', which is higher than its Viability Rating (VR) of 'bb'. The GSR reflects Fitch's expectation that SBI is highly likely to receive extraordinary state support from the Indian sovereign (BBB-/Stable), if required. This is due to SBI's very high systemic importance in light of its status as
For more details on SBI's key rating drivers and rating sensitivities, see 'Fitch Affirms State Bank of
Rating Sensitivities
Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade
An IDR downgrade will result in a similar change in the expected rating on the proposed notes.
Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade
An IDR upgrade will result in a similar change in the expected rating on the proposed notes.
OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS
Senior unsecured long-term ratings (xgs) (EXP) are assigned at the level of the Long-Term IDR (xgs), which is driven by SBI's VR.
OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES
A change in SBI's Long-Term IDR (xgs) would lead to a similar change in its senior unsecured long-term ratings (xgs) (EXP).
Date of Relevant Committee
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING
The principal sources of information used in the analysis are described in the Applicable Criteria.
Public Ratings with Credit Linkage to other ratings
SBI's IDR is the same as
ESG Considerations
SBI has an ESG Relevance Score of '4' for Governance Structure, in line with similarly rated Indian state banks. This reflects our assessment that key governance aspects - particularly board independence and effectiveness, ownership concentration, and protection of creditor and stakeholder rights - are of moderate influence yet are negative for SBI's credit profile, and are relevant to the ratings in conjunction with other factors.
Fitch views SBI's governance to be less developed, similar to other state banks, as evident from significant lending to higher-risk borrowers and segments, which has led to above-average levels of impaired loans and credit losses. The board is also dominated by government appointees, and the bank's business models often focus on supporting government policy, while the bank already has a healthy appetite for risk. Lending could be directed towards socioeconomic and economic policies, and may include lending to government-owned companies. These factors also drive our view of the bank's state linkages, which influence support prospects and drive the long-term ratings.
The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. For more information on Fitch's ESG Relevance Scores, visit www.fitchratings.com/topics/esg/products#esg-relevance-scores.
(C) 2024 Electronic News Publishing, source
