Central Bank of India's Credit Rating Reaffirmed at A1+ by CARE Ratings
CARE Ratings has reaffirmed Central Bank of India's (CBI) credit rating for Certificate of Deposits at A1+. This reflects improved capitalization supported by GoI equity infusions and strong internal accruals. The bank's asset quality and profitability are moderate but improving. Capital adequacy remains strong, well above regulatory norms.
A reaffirmed A1+ rating on a significant instrument like Certificate of Deposits (₹20,000 crore) is positive for the bank's borrowing costs and market confidence. However, it is a reaffirmation rather than an upgrade, and the underlying business challenges (moderate profitability compared to peers) suggest a medium impact.
The reaffirmation of a strong credit rating (A1+) by CARE Ratings for Central Bank of India's Certificate of Deposits indicates a positive assessment of the bank's financial health and stability.
Central Bank of India (CBI) has announced the reaffirmation of its credit rating for Certificate of Deposits (CD) by CARE Ratings Ltd. The rating assigned is A1+, with no outlook specified, and the action taken was 'Reaffirmed' on October 07, 2026. The total amount for Certificate of Deposits is ₹20,000 crore.
The rating reaffirmation reflects the improvement in CBI's capitalization levels, supported by strengthened internal accruals and significant equity capital raised in recent years, including an infusion of ₹21,835 crore from the Government of India (GoI) between FY16 and FY23. CARE Ratings expects continued need-based funding support from the GoI, which remains the majority shareholder.
The bank's asset quality and profitability, while improving, are considered moderate compared to peers. CARE Ratings anticipates that CBI will maintain its Net Interest Margin (NIM) by sustaining its Current Account and Savings Account (CASA) mix, even amidst challenging deposit mobilization conditions. Key monitorables for the bank include its ability to manage slippages and enhance profitability in the current macroeconomic environment.
CBI's capital adequacy ratios remain comfortably above regulatory requirements. As of June 30, 2026, the Total Capital Adequacy Ratio (CAR) was 18.28% (CET-1 and Tier-I: 16.54%), against a regulatory minimum of 11.5%. The bank also has Board approval for raising capital via Basel III instruments aggregating to ₹7,000 crore in FY27.
The bank has demonstrated strong growth in advances, with net advances growing by approximately 19% in FY26. The focus remains on the retail, agriculture, and MSME (RAM) segments, which constitute a significant portion of its advances. Deposits have also grown, and the CASA proportion, while slightly declined, remains among the highest for Public Sector Banks (PSBs).
Asset quality has shown improvement, with the Gross NPA ratio at 2.67% and Net NPA ratio at 0.49% as of March 31, 2026. Profitability saw an increase in Profit After Tax (PAT) to ₹4,369 crore in FY26 from ₹3,785 crore in FY25. The bank's liquidity position is strong, with a Liquidity Coverage Ratio (LCR) of 156.59% and a Net Stable Funding Ratio (NSFR) of 128.25% as of June 30, 2026.
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