"DFCC's ratings reflect its strong financial profile, good asset quality and strong capital position among banks in Sri Lanka," Fitch Ratings said.
"It also takes into consideration DFCC's greater exposure to riskier long term project lending and less diversified funding base."
Fitch says the AA (lka) national rating denotes a very strong credit risk relative to other issuers or issues in the same country.
"The credit risk inherent in these financial commitments differs only slightly from the country's highest rated issuers or issues," the agency said.
The Banks profitability, measured by return on assets, had fallen to 3 percent at during the third quarter of 2007, from 3.5 percent at end 2006 with the effective tax rate climbing 51 percent from 41 percent.
Commercial Bank of Ceylon Limited, a 28.99 percent-owned associate, put in 44