Fitch cuts Housing Development Finance

Fitch Ratings said it downgraded the national long-term rating of the Housing Development Finance Corp. Bank of Sri Lanka to BBB+(lka) from A-(lka), along with its outstanding senior unsecured debentures to BBB+(lka) from A-(lka), consisting of 2005/2010, 2015, 2020 senior unsecured redeemable debentures of LKR250 million 2005/2009 senior unsecured redeemable debentures of LKR125 million.

The outlook remains negative.

The action reflects Fitch's view that the continued escalation of the company's inherent interest rate risk has weakened its financial profile to a level that cannot sustain a higher rating over the medium term, Fitch said.

However, Fitch derives comfort from possible state support, given the government of Sri Lanka's 51% stake in the company, the agency said, and the bank's perceived importance to the state's housing policy.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.