Mar 06, 2012 (LBO) – Sri Lanka’s People’s Merchant Plc’s (PMP) ‘BB+(lka)’ national rating has been confirmed by Fitch Ratings with a stable outlook. The rating reflected the support that would be forthcoming if required from its main shareholder stat-run People’s Bank (PB) which has been rated ‘AA(lka)’ with a stable outlook, Fitch said.
“Fitch’s view of support is also based on PMP’s association with, and consequent reputational risk to, PB’s franchise given the common brand identity and PB’s representation on PMP’s board,” the rating agency said.
The full statement is reproduced below
Fitch Ratings-Singapore/Colombo-05 March 2012: Fitch Ratings Lanka has affirmed Sri Lanka’s People’s Merchant PLC’s (PMP) National Long-Term rating at ‘BB+(lka)’. The Outlook is Stable.
The rating reflects implied support that Fitch expects would be forthcoming from its main shareholder, state-owned People’s Bank (PB; ‘AA(lka)’/Stable), if required, and its weak standalone financial profile. PB has a 36% effective shareholding in PMP, directly and via PB’s subsidiary People’s Leasing PLC (‘A+(lka)’/Stable). Fitch’s view of support is also