Muthoot Finance Strengthens Credit Profile with Rating Upgrades

Moody’s Ratings in its press release has stated, inter alia, “The upgrade  of Muthoot's ratings reflects its strong credit profile, supported by its leading franchise and  solid track record in the gold financing industry in India. 

Muthoot's strong operational controls and risk management practices in the gold financing  portfolio support its growth and asset quality. Despite strong competition and aggressive lending practices by other banks and non-bank financial institutions, the company has  maintained its underwriting standards resulting in consistent loan growth and stable asset  quality. 

Muthoot is most profitable among our rated Indian finance companies, and its profitability is  a significant creditstrength. Net income to average managed assets wasstrong at 4.9% in the nine months ended December 2024, supported by a high net interest margin and low credit  costs on gold financing. The company's superior profitability supports internal capitalization,  reflected in its tangible common equity to total managed assets (TCE/TMA) of around 23.3%  at the end of December 2024.” 

George Alexander Muthoot, Managing Director, on this occasion, stated “We are pleased to  announce that Moody's Ratings has upgraded our long-term corporate family rating to Ba1 from Ba2. This upgrade signifies Moody's confidence in our robust financial performance, strong asset quality, and resilient business model of The Muthoot Group. The Ba1 rating  reflects Muthoot Finance's consistent profitability, prudent risk management practices, and  diversified funding profile. Our strong operational resilience, demonstrated by our ability to  navigate challenging market conditions, has also been recognized by Moody's Ratings. This  credit rating upgrade is a testament to the dedication of our employees, the trust of our customers, and the support of our stakeholders. We remain committed to delivering  sustainable growth, enhancing stakeholder value, and maintaining our position as a leader in  the financial services industry. 

We express our sincere gratitude to all our stakeholders for their unwavering support and  belief in Muthoot Finance. We will continue to strive for excellence and uphold the highest standards of corporate governance and ethics.” 

In addition, Muthoot Finance has also received an upgrade from S&P Global Ratings to ‘BB+’  with a ‘Stable’ outlook, further reinforcing its strong financial position and commitment to  excellence in the financial services sector.