ICRA to rate Central Bank of India’s loansMarch 17th, 2008 - 3:10 pm ICT by admin
Mumbai, March 17 (IANS) Credit rating agency ICRA Ltd will now issue ratings to the loans and other exposures made by Central Bank of India. ICRA (Investment Information and Credit Rating Agency), an associate of Moody’s Investor Service, has signed a memorandum of understanding (MoU) with the bank for the line of credit rating services, the bank said.
Under the MoU, the rating agency will study and assign benchmarks for loans and similar exposures under the framework outlined under the Reserve Bank of India’s New Capital Adequacy Framework, Basel-II.
In banking parlance, Basel II relates to the recommendations made by the Basel Committee on Banking Supervision, for banking laws and regulations which would help the banking regulator to enact provisions whereby banks can be protected against financial and operational risks.
The bank in its statements said the ratings by the agency for the line of credit would enable it in assigning new risk weights applicable to its borrowers. The risk weights would be linked to the various rating categories as per RBI guidelines.
To assist potential and existing borrowers of Central Bank in obtaining ratings, the MoU also include offerings of special terms to the clients of CBI.
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