US-based ratings agency Moody's Investors Service on Wednesday downgraded the credit rating of six Bangladeshi banks at one go -- a day after it reduced the sovereign credit rating of the country.
The six lenders are Brac Bank, City Bank, Dutch-Bangla Bank, Eastern Bank, NCC Bank, and Premier Bank.
The latest rating actions on the six banks follow Moody's lowering of the long-term rating of Bangladesh to B1 from Ba3 on May 30, said the company in a report on the day.
Moody's said that the downgrade of the ratings of Brac Bank, City Bank, DBBL, and EBL was driven by the cut in the sovereign rating, which measures the country's capability to provide support to banks in times of stress.
The confirmation of Brac Bank's rating of b1 reflected its better asset quality and capital compared to peers, strong deposit base and access to funding and good liquidity, said Moody's in the report.
The confirmation of City Bank, DBBL, and EBL's b2 has reflected their moderate asset quality, profitability, and capitalization, supported by their stable deposit bases and adequate liquidity.
The lowering of rating for Premier Bank and NCC Bank to b3 from b2 points to their deteriorating asset quality.
Mercantile Bank's rating of b3 reflects the bank's deteriorating asset quality and profitability, balanced by stable capital, funding, and liquidity, the report added.