JCR-VIS Credit Rating Company Limited (JCR-VIS) has upgraded the entity ratings of Rozgar Microfinance Bank Limited (RMBL) from 'BB-/B' (Double B Minus/Single B) to 'BB3' (Double B Plus/A-Three). The upgrade takes into account the excess liquidity carried on books vis-a-vis financial obligations.
The equity of the bank increased during the last year through right issue, following which the shareholding structure of the bank has experienced change, with two large investors now holding 49 percent stake. The bank was, however still short of the minimum capital requirement (MCR) for district level MPBs by about Rs 5.7m, as at end Mar. 2011. In view of this and regulatory requirements of MCR for 2011, ratings continue to be placed under 'Rating Watch - Developing' status.
With funds from the rights issue currently invested in government securities, the bank has been able to curtail losses presently, amidst business stagnation. To revitalise operations, the bank is in the process of developing a business plan.-PR