IOB ties up with ICRA to rate loans

Mumbai, Sep 11 (UNI) In line with Reserve Bank's new capital adequacy framework for Basel-II, Chennai-based Indian Overseas Bank (IOB) has inked a pact with ICRA to rate its loans and other risk exposures.

The Bank today signed a Memorandum of Understanding (MoU) with ICRA as per which the latter would rate the exposures under its ''line of credit rating service'' thus arming the lender to assess the new risk weights applicable to IOB's borrowers under Basel-II, ICRA informed BSE today.

Under the process, risk weights will be linked to various rating categories and in line with the RBI guidelines. This will assist the potential and existing borrowers of the bank in obtaining ratings.

Under the agreement, ICRA will offer special terms to the clients of the Bank.

While the pact will benefit IOB in implementing RBI's new capital adequacy framework under Basel-II, the rated entity will also benefit in terms of faster loan processing and to obtain competitive credit terms from the Bank.

UNI