Aug 28, 2008 (LBO) – Fitch Sri Lanka said it had downgraded the national long term rating of First Capital Treasuries, a primary dealer in government securities, to ‘A- (lka)’ from ‘A(lka)’ and also withdrawn the rating at the request of the company. “FCT was the only independent primary dealer to have carried a rating by the agency in Sri Lanka,” Fitch Ratings said in a statement.
“The downgrade reflects the increased volatility in the domestic interest rate environment over the past two years and the resulting increase on market risk inherently borne by primary dealers.
“However, the agency notes the conservative trading positions carried by FCT in the last year and the currently low modified duration of 0.7 of the portfolio.”
Fitch will no longer provide rating coverage on FCT.