, India
Photo by Sasun Bughdaryan from Unsplash

Manappuram Finance reputation at risk amidst invention

The Indian NBFC may be facing money laundering investigations.

Manappuram Finance, an Indian non-banking finance company, is at risk for reputational damage due to money laundering investigation, S&P Global Ratings wrote.

India's law enforcement and economic intelligence agency is investigating Manappuram Agro Farms (MAGRO), which was previously owned solely by V.P. Nandakumar, CEO and managing director of Manappuram.

It is not yet final if the financing firm will undergo legal, financial or funding risk from the probe, said S&P.

“Whilst not our base case, any significant negative findings on the core business of Manappuram could affect investor confidence in the company, which operates in a market-sensitive segment,” said S&P.

ALSO READ: India’s banks can withstand fallout from US bank failures, Credit Suisse sale

Compared to world standards, the overall corporate governance standards for financial institutions in India are weak, resulting in a higher risk assessment within our banking industry country risk assessment framework.

Manappuram's ratings are primarily supported by its strong capitalization and earnings, as well as its position as a leading provider of gold-backed lending in India. 

As of 3 May, the company has INR35b (US$430m) in working capital loans due for repayment in three months, with liquid assets of INR10b (US$120m). 

The majority of the company's asset base consists of short-term, self-liquidating loans, which helps to mitigate refinancing risk.

(INR1 = US$0.012)

 

Follow the link for more news on

Join Asian Banking & Finance community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!