ICRA has downgraded the ratings on the Bank of India's (BoI) lower tier-II bonds programme, upper tier-II bonds programme and innovative perpetual debt instruments due to higher stress and NPAs.

The rating agency has lowered ratings on the Rs 9.50 billion lower tier-II bonds programme from [ICRA]AA+ to [ICRA]AA and on the Rs 10 billion upper tier-II bonds programme from [ICRA]AA to [ICRA]AA-. Similarly, ICRA has reduced its ratings on the Rs 6.58 billion innovative perpetual debt instruments from [ICRA]AA to [ICRA]AA-.

The rating agency said, ''The rating revisions are on account of higher than anticipated stress, slower than expected pace of recovery and weak outlook for several credit intensive sectors which led to sharp deterioration in asset quality indicators of the bank and has impacted the earnings profile of the bank.''

The rating agency further said, ''In our opinion, earnings profile of the bank over the medium term is likely to remain weak given the relatively high share of stressed assets and high un-provided NPAs.

''Limited visibility on capital availability to fully support credit growth while meeting the regulatory minimum requirement also constrains the rating,'' it added.

ICRA has also revised the ratings for term deposit programme from MAAA to MAA+.

Shares of the bank declined Rs 2.55, or 2.93%, to trade at Rs 84.35. The total volume of shares traded was 443,023 at the BSE (2.15 p.m., Tuesday).