In a press release on Friday the company said the rating reflects a capital base that is adequate to support business expansion and absorb losses from any adverse changes. However, the rating is constrained by deteriorating asset quality and an increase in liquidity risk.

Profitability has weakened in past years but should remain relatively stable over the next few years.

ML’s market position in terms of outstanding loans remains weak compared with peers but is likely to expand gradually.

Meanwhile, intense competition in the auto financing industry continues to put some pressure on loan expansion and profitability.