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Informist, Friday, Feb. 27, 2026

 

--S&P Global assigns 'BBB' long-term issuer credit rating to Bank of Baroda 
--S&P Global assigns 'A-2' short-term issuer credit rating to Bank of Baroda 

--S&P Global's outlook on Bank of Baroda's long-term rating is 'stable' 
 

NEW DELHI – S&P Global Ratings has assigned a long-term issuer credit rating of "BBB" with "stable" outlook to Bank of Baroda, the bank informed the exchanges Friday. S&P Global Ratings also assigned a short-term issuer credit rating of "A-2" to the bank.

 

The rating agency expects the bank to receive extraordinary support, if needed, from the government. "We see a very high likelihood that the government would provide the bank with timely and sufficient extraordinary support in the event of financial distress," S&P Global Ratings said. "We base our view on Bank of Baroda's very important role as a public sector bank in promoting financial inclusion through increased access to deposits and lending. The bank has very strong links with the government via the latter's majority ownership and control."

 

The stable long-term rating outlook reflects the agency's expectation that the bank will maintain its strong funding and liquidity, supporting its credit quality, S&P Global Ratings said. "We expect Bank of Baroda to maintain its risk management framework and asset quality over the next two years," S&P Global Ratings said. "The bank's capitalisation should also remain healthy and sufficient to support credit growth above the industry average."

 

According to the agency, Bank of Baroda is among India's top 10 players in the banking sector, holding 5-6% of loans and deposits in a fragmented market. "We expect its return on average assets to be 1-1.2% over the next two years, in line with some public sector banks but below major private sector players," it said.

 

Bank of Baroda's focus on higher-yielding retail, agriculture, and micro, small, and medium enterprises segment will predominantly support its net interest margin, the rating agency said. This could, however, be tempered by the thinner margins in its international business. Bank of Baroda has one of the largest international footprints of Indian banks.

 

S&P Global Ratings said it could downgrade the bank's rating if India's sovereign rating is downgraded or Bank of Baroda's stand-alone credit profile drops two notches. This could happen if the bank's asset quality or risk management weakens significantly, or if its funding profile slips as compared to peers. On the other hand, it could upgrade the rating if the country's sovereign rating is raised.

 

For the December quarter, Bank of Baroda had reported a net profit of INR 50.55 billion and net interest income of INR 118 billion. Friday, shares of the bank closed 0.8% lower at INR 321.95 on the National Stock Exchange.  End

 

Reported by Vaishali Tyagi

Edited by Rajeev Pai

 

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