Fitch affirms Merchant Credit of Sri Lanka

Fitch Ratings said it affirmed Merchant Credit of Sri Lanka Ltd.'s national long-term rating at BBB(lka), reflecting the implied support assumed to be available from its ultimate parent, state-owned Bank of Ceylon, which is rated AA(lka).

The outlook is stable.

The agency said it takes considerable comfort from the Bank of Ceylon's effective ownership of 88% of Merchant Credit, as well as board level linkages through common directors, Fitch said.

The company's rating is constrained by poor solvency as indicated by the net NPL/equity ratio, the agency said.

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