Moody’s expects interest rates to remain low in the coming years and high leverage to be ‘gradually’ absorbed by the region’s economic growth. “Specifically, systems like China, India, Indonesia and Singapore report high concentration of corporate leverage among borrowers with low debt servicing capability,” Moody’s stated in the report. Of the overall corporate debt owed by firms in India, over 15% is owed by firms with ICR less than 1. “The Reserve Bank of India lowered the risk of individual housing loans to align it with Basel standards, while easing standard asset provisioning requirements for all individual housing loans. These measures provide an incentive for banks to grow housing loans,” Moody’s said, adding property prices in India have more than doubled since 2010.

Source: Mint November 29, 2017 23:15 UTC