No Watch

May 21, 2009 (LBO) – RAM Ratings Lanka said a rating watch on Arpico Finance Company has been lifted after the company met a Central Bank requirement for minimum capital of 200 million rupees by March 2009.

RAM Ratings Lanka said the regulator would assess the company’s core capital after financial were audited, but RAM Ratings said in its opinion the firm’s regulatory risk had “largely dissipated.”

The firm has ‘BB’ long term rating from RAM.

As at end-June 2008, Arpico’s core capital was 133.26 million was or 66.74 million rupees short of the Central Bank’s minimum requirement.

RAM said Arpico Finance had raised 80.06 million rupees from two rights issue in June (14.44 million rupees) and March 2009 (65.62 million rupees)/

Following the capital injections Alfinco Insurance Brokers (Pvt) Ltd (Alfinco) now owned a majority stake of 40.56 percent in Arpico Finance.

Alfinco is 39.00 percent-held by Alliance Finance Company PLC (Alliance).

Alliance now owns (directly and indirectly) 35.35 percent of Arpico. It had previously held 39.60 percent.