S&P changes outlook on two Indian banks

S&P said it revised the outlook for Syndicate Bank to positive and on Indian Bank to negative based on S&P’s assessment of the likely impact of the mergers on these banks.

The outlook on Union Bank of India remains stable.

The Indian government plans to merge 10 state-owned banks, and S&P revised the outlooks based on what it sees as the likely effects of the merger on the three banks.

“We continue to factor a very high likelihood of support for government-owned banks in India. We believe that the government treats the banks as one family and has not shown any material differentiation among these banks when it provides policy guidance, conducts performance reviews, or infuses capital,” said the agency in a news release.

S&P affirmed the banks’ ratings.

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