Fitch assigns PLC long-term rating A(lka)

Fitch Ratings Lanka has assigned People's Leasing Company (PLC) Ltd's proposed senior debentures of upto Rs. 750m a national long-term rating of A(lka).

The issue is rated at the same level as PLC's National long-term rating of A(lka) which has a stable outlook. This is in compliance with Fitch's rating criteria on senior unsecured bond instruments of financial institutions.

The debentures carry maturity options of between three and four years and will be issued at a fixed interest rate, helping PLC to reduce interest rate mismatches between its assets and liabilities.

The ratings reflect PLC's strong financial profile which in turn has driven its entrenched market share as Sri Lanka's largest specialised leasing company, (SLC) and its effective risk management systems and controls.

The rating also derives comfort from People's Bank's 100 percent ownership. (PB, AA-(lka), positive) of PLC.

The latter carries out the entirety of PB's incremental leasing business and contributed to over 20 percent of PB's consolidated post tax profits at end 2010. PLC's total assets stood at Rs. 49bln as at end 2010 which amounted to a share of 13 percent of aggregate SLC and registered finance company sector assets.