S&P ratings for ICICI Bank post-merger
By Our Banking Bureau | 02 May 2002
The RBI also has given ICICI Bank some concession with respect to compliance with priority-sector lending requirements and with the equity exposure ceiling of 5 per cent on advances, says Financial Services Ratings director Peter Sikora. The bank, however, will be required to adhere to all other regulatory requirements.
ICICI Bank has adopted fair valuation of ICICIs assets under the purchase method of accounting for mergers (under Indian GAAP), with the fair value review of the loan portfolio being completed by an external valuer.
Additional provisioning will be made to cover non-performing loans and restructured assets following completion of the fair valuation process. Additional provisioning against standard assets will also be raised as a precautionary measure, says Sikora.