India Ratings & Research (Ind-Ra) has affirmed Jammu and Kashmir Bank long-term issuer rating at 'AA' with a stable outlook. The agency has also affirmed JK Bank's Rs 6 billion lower Tier II debt at 'AA'.

JK Bank's ratings are driven by Ind-Ra's expectation of a moderate probability of support from the government of India (GoI), through the J&K state government, if required.

This factors in the bank's central role in sustaining the economy of the politically important state of Jammu and Kashmir (J&K), its dominant position in the banking business in J&K, its role as the agent of the Reserve Bank of India for conducting the general government business of the state government and its majority ownership by the J&K state government.

The lower tier II subordinated bonds are rated at the same level as the long-term issuer rating based on Ind-Ra's criteria for rating of bank legacy hybrids and subordinated debt.