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Rising risk for financial sector
S&P Global Rating sees Indian economic growth at 7% in the medium term and projects 7.5% growth in fiscal 2022, albeit from a small base,.
However, a prolonged slowdown, particularly if the recovery in fiscal 2022 is significantly slower or delayed, could adversely affect the financial institutions sector, it cautioned.
But S&P has further revised down fiscal 2021 GDP growth projections to 1.8% from earlier expectation of 3.5%.
The economic risk for Indian financial institutions is rising, says
S&P Global Ratings, the rating actions of which reflect that the Indian NBFCs face increasing risks from challenging operating conditions stemming from the COVID-19 outbreak.
Economic conditions have turned adverse due to the COVID-19 pandemic. Drastic efforts to curtail the spread of the coronavirus has resulted in a sudden stoppage in economic activity.
“We have, therefore, revised our economic risk trend for the financial sector to negative from stable,” said S&P on 17 Apr 2020. fiinews.com
