Standard Chartered reaffirmed with AAA Rating for fifth time in row

KATHMANDU, MARCH 27: ICRA Nepal has maintained the issuer rating of [ICRANP-IR] AAA for Standard Chartered Bank Nepal Limited (SCBNL) for the fifth consecutive year. This rating indicates that the bank has the highest degree of safety when it comes to servicing financial obligations, and has the lowest credit risk.

In the rationale statement, ICRA Nepal has stated that the rating reaffirmation is due to the bank’s strong capitalisation profile. The bank has capital to-risk-weighted assets ratio (CRAR) of approximately 16% and tier-I capital of about 13% as of mid-January 2024, which is above the regulatory minimum of 11% and 8.5%, respectively.

Additionally, the rating acknowledges the bank’s strong asset quality with a reported gross non-performing loans (NPLs) of 1.60% as of mid-January 2024, which is much lower than the commercial banking industry average of 3.63%, despite the recent increase (NPLs were 0.72% as of mid-January 2023 when last rated).

The rating action also considers the bank’s long track record of operations since 1987, strong parentage (approximately 70% subsidiary of the Standard Chartered Group), and competitive positioning underpinned by its global brand reputation and competitive cost of funds.

Anirvan Ghosh Dastidar, CEO of Standard Chartered Bank Nepal Limited, expressed gratitude for the reaffirmation of the AAA rating for five years in a row and stated that it is a strong validation of their commitment towards their clients and all stakeholders.