Asset Backed

Sri Lankan President Maithripala Sirisena (L) and Sri Lankan Prime Minister Ranil Wickremasinghe gesture as Sri Lankan Finance Minister Ravi Karunanayake (unseen) presents a supplementary budget to parliament, marking the first economic policy statement of the new government which came to power earlier in the month in Colombo on January 29, 2015. Sri Lanka's new government announced hefty taxes on top companies in a bid to raise revenue, accusing the previous regime of fudging the figures and leaving the economy in a "sad state". AFP PHOTO / Ishara S. KODIKARA (Photo credit should read Ishara S.KODIKARA/AFP/Getty Images)

Sept 03, 2007 (LBO) – Fitch Sri Lanka has affirmed the ‘A (lka) national rating given to lease-backed securities of Senkadagala Finance Company, which has a ‘BBB+ (lka)’ rating with a stable outlook. The Lease Backed Trust Certificates (LBTCs) were issued by the special purpose vehicle Senkadagala Finance Trust Three (SFT3) with its credit enhanced by overcollateralization or having larger volume of leases than is needed to pay the principle and interest of the lease backed securities.

“The affirmation of the current rating is based on the high level of credit enhancement available to the LBTCs in the form of principal overcollateralisation (defined as excess principal of the underlying pool of loans/the outstanding principal of the LBTCs), which is adequate to absorb the stressed losses of the underlying pool of assets,” Fitch said.

“The rating also reflects the uninterrupted payouts made to LBTC investors from cash flows derived from the underlying pool (without recourse to the originator) during the current review period (January 2007 to June 2007).”

Fitch said six monthly payouts were made during the period reducing the outstanding principal on the notes to 9.6 million rupees.