Bank Rating

Sri Lanka's Prime Minister Ranil Wickremesinghe arrives with flowers to receive blessings at the Gangaramaya Buddhist Temple, Colombo, Sri Lanka on Wednesday 4 April 2018. On wednesday (4), Wickremesinghe survived a no-confidence motion in the Sri Lankan parliament with a 46 vote majority after a 12-hour debate with 122 MPs voted in his support while 76 MPs voting to remove the prime minister. (Photo by Tharaka Basnayaka/NurPhoto via Getty Images)

Oct 09, 2008 (LBO) – Fitch Ratings Lanka has affirmed the National Long-term rating of DFCC Bank (DFCC) at ‘AA(lka)’ with a stable outlook. The rating agency has also affirmed DFCC’s senior debentures at ‘AA(lka)’ and subordinated debentures at ‘AA-(lka)’ (AA minus (lka)).

Fitch said the ratings reflect DFCC’s strong capital base and sustained high profitability.

But it said the rating also factors in the bank’s “inherent lack of product and funding diversity as a development finance institution (DFI), as well as its relatively large exposure to riskier long-term project finance.”

Fitch said DFCC Bank has been successfully maintaining high levels of profitability owing to the significant component of concessionary-rate credit lines, as well as the support it gets from its large capital base.

As a DFI, Fitch said, DFCC has enjoyed concessionary-rate credit lines from multilateral and bilateral donor agencies.

These loans amounted to 33.7 percent of DFCC’s funding base at FYE08.

However, Fitch said that securing such funds would become increasingly difficult since one of the main criteria is the country’s sta