June 17, 2011 (LBO) – Fitch Ratings Lanka has assigned People’s Leasing Company’s (PLC) proposed senior debentures of up to 750 million rupees a National Long-Term rating of ‘A(lka)’. “The issue is rated at the same level as PLC’s National Long-Term rating of ‘A(lka)’ which has a stable outlook,” the rating agency said in a statement.
“This is in compliance with Fitch’s rating criteria on senior unsecured bond instruments of financial institutions.”
The proposed instrument will rank on equal footing with PLC’s senior creditors, Fitch said.
The debentures carry maturity options of between three and four years, and will be issued at a fixed interest rate, helping PLC to reduce interest rate mismatches between its assets and liabilities.
“The ratings reflect PLC’s strong financial profile, which is in turn driven by its entrenched market share as Sri Lanka’s largest specialised leasing company (SLC), and its effective risk management systems and controls.
The rating also “derives comfort” from the 100 percent ownership of PLC by state-owned People’s Bank’s.
PLC carries out the entirety of People’s Bank’s incremental leasing business, and contributed to ov