Stable Rating

December 14 (LBO) – Rating agency Fitch gave pawn brokering business Edirisinghe Trust Investments a ‘B+(lka)’ long term rating, but said the company was hampered by low profitability and weak management systems. The company was founded in 1967 by the Edirisinghe family and remains a closely held family company. ETI is a registered finance company and is also a registered finance leasing establishment, and is regulated by the Central Bank.

The outlook on the rating is stable, taking into account the company’s large franchise and strong market position in pawn brokering (gold-backed lending), Fitch said.

At the same time, its rating is constrained by its low profitability, and relatively weak management systems, controls and procedures that require improvements particularly in light of the increased diversity in ETI’s business.

The company had a loan portfolio of 1.8 billion rupees at the end of the 2006 financial year, placing it among the medium sized players in the sector.

Portfolio growth was a high 81 percent in the 2006 financial year, compared to 28 percent portfolio growth for registered finance companies.

Pawn brokering makes up 52.4 percent of the ETI’s total por