Latest news with #S&PGlobalRatings
Hans India
20 hours ago
- Business
- Hans India
RBI's new rule on gold loans to change mkt dynamics
New Delhi: The RBI's new rules on lending against gold will lead to business model adjustment, and operational agility, service excellence will remain the key differentiator between lenders, S&P Global Ratings said on Thursday. Earlier this month, the RBI raised the loan-to-value (LTV) ratio for lending against gold to 85 per cent for borrowings under Rs 2.5 lakh from the present 75 per cent. The LTV ratio has been fixed at 80 per cent for loan amounts between Rs 2.5-5 lakh and 75 per cent for loans above Rs 5 lakh. Lenders have time until April 1, 2026, to prepare for the changes. In its report titled 'India's new rules on gold-backed loans may reshape the competitive landscape', S&P said the Reserve Bank of India's new rules on gold-backed loans will likely lead to business model adjustments in the country's booming lending niche. 'In our view, operational agility and service excellence will remain the key differentiator between lenders,' S&P said. S&P Global Ratings credit analyst Geeta Chugh said NBFCs need to develop risk management policies and processes to evaluate borrowers' repayment capabilities based on income and cash flows. 'Traditionally, they have relied on collateral valuation. Bridging the skill gaps to hire and train loan officers on assessing repayment ability is both an upfront cost and an hurdle to overcome for these lenders,' he said.
India Gazette
a day ago
- Business
- India Gazette
India's new gold loan regulations to reshape lending landscape: S&P Global
New Delhi [India], June 19 (ANI): S&P Global Ratings anticipates that the new regulations in Gold-Backed Loans will necessitate business model adjustments for lenders, with nimble players likely to gain a competitive booming gold-backed loan sector is poised for significant changes with the introduction of new regulations, expected to be fully implemented by April 1, 2026.A key change involves the inclusion of interest payments until maturity in the calculation of Loan-to-Value (LTV) ratios, which could reduce the initial loan amount disbursed to borrowers. Additionally, credit appraisals for consumption-focused loans exceeding USD 3,000 and all income-generating loans will now require a cash flow analysis of borrowers, a departure from the traditional reliance on collateral new rules also aim to enhance customer protection by standardizing the regulatory framework and addressing prudential and conduct gaps. This includes clearer guidelines on collateral handling and auction processes, mandating the return of pledged collateral and auction surpluses to borrowers within seven working above INR 20,000 (approximately USD 231) will now be made directly to borrowers' bank accounts. The RBI is also emphasizing greater transparency in interest rate and fee disclosures and scrutinizing the outsourcing of core financial shift will particularly impact nonbank financial companies (NBFCs) with large gold loan portfolios, such as Muthoot Finance Ltd. and Manappuram Finance Ltd., as they will need to invest in developing new risk management policies and training loan these adjustments, operational agility and service excellence, including quick and seamless loan disbursement, will remain crucial differentiators for lenders. NBFCs' strong customer relationships and investments in analytics are expected to help them maintain these new models offer opportunities, they also introduce risks, particularly the heightened sensitivity to sharp corrections in gold prices if higher LTV norms are adopted for income-producing loans. Gold prices have surged by nearly 80% since late 2023, leading to a significant increase in collateral value and loan books. The RBI's regulatory treatment of NBFC gold loans, which applies a 100% risk weight, helps mitigate price risk, although banks currently benefit from a 0% risk weight on these loans. (ANI)
Arabian Post
2 days ago
- Business
- Arabian Post
UAE Set for Steady 4 % Economic Growth Through 2028
Arabian Post Staff -Dubai The United Arab Emirates is on track to maintain an annual growth rate of approximately 4 % from 2025 through 2028, underpinned by robust expansion in non-oil sectors and rising oil output, according to S&P Global Ratings. S&P's Zahabia S Gupta, Director of the Sovereign team, emphasised that even with softened oil prices and global growth headwinds, the federation and individual emirates are projected to record consecutive fiscal surpluses. Boosted liquidity and investment returns are expected to raise the UAE's net asset position to around 177 % of GDP by 2028. ADVERTISEMENT Oil production quotas agreed by OPEC+ are forecast to remain elevated, enhancing the UAE's hydrocarbon revenues, though the non-oil sectors—such as finance, real estate, tourism, and services—are seen as the main drivers. The Central Bank raised its 2024 GDP projection to 4 % and forecasts growth of 6 % for 2025. Sectoral diversification, including continued investment in infrastructure, logistics, and digital technologies, will support sustained activity levels across the seven emirates. Emirates' fiscal health, backed by solid sovereign reserves and rising yields on sovereign-backed assets, positions the government to generate surpluses even amid modest global economic slowdown. Gupta points out that income from liquid investments will be critical in reinforcing net asset accumulation. This resilient fiscal trajectory contrasts favourably with regional peers. Sharjah, however, presents a more cautious outlook. S&P recently revised its forecast for the emirate's economic performance, predicting roughly 3 % annual growth through 2028 alongside a widening deficit that is expected to reach 6.7 % of GDP in 2024. The difference underlines the UAE's internal variance in expansion and structural robustness. The UAE's medium-term macroeconomic forecast aligns with IMF projections indicating real GDP growth of about 4.2 % in 2025 and a gradual uptick to 4.5 % by 2028. Non‑oil GDP growth is expected to consistently outpace the oil sector, significantly contributing to overall diversification efforts. Financing this will involve domestic debt issuance, estimated at around US $19 billion in 2024, nearly 55 % of which will be allocated to development projects. Market observers note that the central bank's policy rate adjustments, tied to the US Federal Reserve, may influence domestic lending conditions, but the policy outlook remains cautious given the dirham's peg to the dollar. Financial sector resilience—evidenced by healthy bank liquidity and expanding lending—will support private sector credit growth. The UAE's strategic economic pivot includes deeper integration into global supply chains, expansion of tourism and hospitality capacity, and advanced digital infrastructure rollout. High-profile projects such as the Wynn Al Marjan Island integrated resort, which is set to open in Ras Al Khaimah in 2027, reflect the commitment to economic diversification. Investors and analysts recognise that sustaining 4 % growth will require balancing oil revenue reliance with resilient non-hydrocarbon sectors. Fiscal discipline and effective public investment will remain crucial, particularly amid geopolitical tensions and potential global demand fluctuations. S&P's projections anticipate that the UAE will continue recording fiscal surpluses, unlike other economies which may face tightening pressures. The UAE's economic trajectory contrasts sharply with that of Saudi Arabia, where growth is expected to accelerate to about 4 % over the same period—yet heavily influenced by oil production—underscoring the UAE's relative strength in non‑oil diversification. The country's strategic position as a regional financial and logistics hub reinforces its prospects against external shocks. Challenges persist, including global inflationary pressures, energy price volatility, and regional geopolitical uncertainty. The government's capacity to manage these risks, while preserving capital buffers and sustaining reform momentum, will be critical to achieve projected outcomes.
Al Etihad
2 days ago
- Business
- Al Etihad
S&P Global maintains UAE credit ratings
19 June 2025 00:23 MAYS IBRAHIM (ABU DHABI)S&P Global Ratings has assigned the UAE a sovereign credit rating of 'AA' for long-term, and 'A-1+' for short-term foreign and local currency obligations, with a stable report cited the county's solid fiscal and external positions, prudent policymaking and resilient economic headwinds from lower oil prices and a global economic slowdown, S&P forecasts that the UAE's economy will remain resilient, growing at an average rate of about 4% annually between 2025 and will be driven primarily by buoyant non-oil sector activity, public investment, and a measured increase in oil production as OPEC+ quotas ease. S&P also projects the UAE's consolidated fiscal surpluses will average 3.2% of GDP over the forecast period, assuming Brent oil prices of $60 per barrel (bbl) in 2025 and $65/bbl through 2028. The country's consolidated net asset position is expected to rise to an estimated 177% of GDP through 2028, supported by continued fiscal surpluses and investment income on liquid assets. "The exceptional strength of the government's consolidated net asset position provides a buffer to counteract the effects of oil price swings and geopolitical tensions in the Gulf region on economic growth, government revenue, and the external account," S&P debt will remain stable at about 28% of GDP, as the federal government and individual emirates such as Abu Dhabi plan local currency debt issuances to develop domestic capital growth will be underpinned by public investment, economic diversification efforts, and increasing trade and foreign investment. The report cited major projects set to boost tourism revenue streams, such as the Saadiyat cultural district and Disney Park in Abu Dhabi, and the Wynn integrated resort in Ras Al UAE's Comprehensive Economic Partnership Agreements (CEPAs) with 27 trade partners should cushion the impact of higher global trade tariffs, to some extent, according to S& added that the potential impact on the UAE from the proposed 50% US tariff on steel and aluminum will only be modest if no agreement is reached. The UAE exported around $1.4 billion (0.3% of GDP) worth of steel and aluminum products to the US in 2023 – only 4.3% of its total non-oil exports. S&P also highlighted structural measures introduced by the UAE to improve its business environment. These include a foreign direct investment law that permits foreign investors to fully own businesses in various sectors, liberalised personal and family law, and the Golden Visa Programme, which "supports talent retention by granting long-term residency to investors, entrepreneurs, and skilled professionals.""We anticipate that these measures will increase labour market flexibility, investment, and foreign worker inflows. This will be balanced by the nationalisation of the workforce, or 'Emiratisation' policies," it stated. The sharp escalation of the Israel-Iran conflict presents potential risks to GCC sovereigns. However, S&P believes the UAE's substantial assets and record of domestic stability mitigate vulnerabilities to external shocks. "The Abu Dhabi Crude Oil Pipeline has the capacity to deliver about 50% of the emirate's oil exports directly to the Fujairah terminal on the Indian Ocean, diversifying its shipping routes. Through CEPAs, the UAE is also securing alternative trade routes to the Red Sea," it explained.
Yahoo
2 days ago
- Business
- Yahoo
Blackstone Bets Big: $200 Billion Shift Signals Europe's Private Credit Boom Is Just Beginning
Blackstone (NYSE:BX) is making a bold move into European credit, eyeing what could be a $200 billion opportunity over the next decade. The firm's Chief Investment Officer for Credit and Insurance, Michael Zawadzki, pointed to Europe's improving fiscal conditions, defense and infrastructure tailwinds, and thinner competition as reasons why private credit looks increasingly attractive. Speaking on Bloomberg TV, he emphasized that because there's less capital in Europe, spreads are wider and leverage is lowerconditions that could create compelling risk-reward setups for long-term investors. The momentum is already visible: 2024 has been Blackstone's busiest year ever in European private credit. Warning! GuruFocus has detected 4 Warning Signs with BX. Zawadzki also addressed the growing conversation around regulation. While S&P Global Ratings recently flagged a need for more transparency in the private credit market, Zawadzki pushed backsaying Blackstone is comfortable with the current framework. The firm structures its products using long-dated, closed-end funds, which are designed to match the duration of their underlying assets. Even for individual investors, liquidity caps are in place to reduce potential mismatch risks. His take? Every dollar flowing into private credit actually helps de-risk the broader financial system by adding stable, long-term capital. As for the potential for trading private credit on a larger scalea topic gaining traction after reports of Apollo working with major banks on syndicated dealsZawadzki was skeptical it would become the norm. He said Blackstone clients aren't chasing liquidity; they're looking for spread and long-term yield that can't be found in public markets. Trading may surface from time to time, but he doesn't expect it to reshape the landscape. For now, the signal is clear: Europe is becoming a serious capital magnet for private creditand Blackstone wants a front-row seat. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
