March 09, 2007 (LBO) – Lanka Orix Finance Company (LOFIN), a subsidiary of Lanka Orix Leasing has shown a 105 percent growth in loans in 2006 Fitch Ratings said, giving the firm a BBB+ (lka) rating. “The principal factor supporting the rating of LOFIN is the strong implied support assumed to be available from its parent Lanka ORIX Leasing Company (LOLC), Sri Lanka’s Sri Lanka’s oldest specialised leasing company,” Fitch Ratings said.
“LOFIN is considered to be strategically important to LOLC, in terms of broadening and diversifying its funding base.”
The parent has been rated A (lka) by Fitch. LOFIN’s national rating has a stable outlook.
Though leasing companies are prohibited from raising deposits, registered finance companies such as LOFIN could do so.
Being 100 percent owned by LOCL, the operations of LOFIN are closely integrated with that with the parent. Fitch is of the view that LOFIN will enjoy a high degree of business and financial support from LOLC.
In the 2006 financial years LOFIN loans have grown by 105 from a small base, with vehicle leasing and hire purchase leading.
Micro leasing under a World Bank renewable energy program accounted for 9.6 percent