Borrowing costs for India’s top-rated shadow financiers declined last month, after the most aggressive economic policies in a decade helped avert a further worsening in the sector during the pandemic. Premiums that investors seek to buy AAA ranked five-year bonds of non-bank financial lenders over government securities declined in May after gaining for three consecutive months. A custom index of total outstanding debt at 50 financiers stayed at the same level as the previous month. India’s policy makers are leaving no stone unturned to help non-bank lenders overcome a credit crisis that started in 2018 and worsened after the world’s biggest lockdown was imposed to contain the spread of the virus. Moody’s Investors Service downgraded the nation’s sovereign rating last week to the lowest investment grade and said it doesn’t expect the credit crunch in the non-bank sector to resolve quickly.

Source: Mint June 09, 2020 13:18 UTC