Tuesday 3 November 2015

Sri Lanka DFCC Bank's debentures get 'AA-(lka)( EXP)' Fitch rating

ECONOMYNEXT - Fitch Ratings said it has assigned DFCC Bank PLC's proposed senior unsecured debentures of up to 10 billion rupees an expected National Long-Term Rating of 'AA-(lka)(EXP)'.

The proposed debentures, which will have tenors of four and six years and carry fixed and floating coupons, will be listed on the Colombo Stock Exchange, a statement said.

DFCC expects to use the proceeds to reduce asset and liability maturity mismatches.

The final rating is subject to the receipt of final documentation conforming to information already received, Fitch said.

“The proposed senior debentures are rated in line with DFCC's National Long-Term Rating. The issues rank equally with the claims of the bank's other senior unsecured creditors,” it said.

“DFCC's rating is driven by its high capitalisation and its developing commercial banking franchise.”

The ratings on the proposed debentures will move in tandem with DFCC's National Long-Term Rating, Fitch said.

“A rating upgrade for DFCC would be contingent on the bank achieving a significantly stronger commercial banking franchise while maintaining strong credit metrics,” the statement said.

“DFCC's rating could be downgraded if there is a sustained and substantial increase in risk appetite that could materially weaken its strong capital position.”

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