Mumbai, July 2 -- Crisil Ratings stated that the rating action is driven by higher than anticipated moderation in profitability on account of continued asset quality pressure resulting in elevated credit costs. Apart from asset quality challenges, the business risk profile has also been constrained by slower than expected revival in business.

As on 31 March 2025, the gross and net non-performing assets (GNPA and NNPA, respectively) increased to 5.6% (24.9% including write-offs) and 1.2%, from 1.5% and 0.3% as on 31 March 2024. This surge in asset quality metrics was a factor of pervading ground level challenges like over-indebtedness and high attrition of field staff since Q1 2025 and challenges in states like Karnataka.

This led the co...