Fitch downgrades SriLankan Airlines

Fitch Ratings said it downgraded the rating on SriLankan Airlines Ltd.'s $175 million government-guaranteed bonds due in June 2019 to B from B+.

This follows the downgrade of Sri Lanka's sovereign ratings, Fitch said.

The company's bonds are rated at the same level as Sri Lanka's ratings due to the unconditional and irrevocable guarantee provided by the state, the agency said.

The downgrade on the sovereign reflects heightened external refinancing risks, an uncertain policy outlook and the risk of a slowdown in fiscal consolidation as a result of an ongoing political crisis, Fitch said.

The agency also said it believes the ongoing political upheaval, which has disrupted the normal functioning of parliament, exacerbates the country's external financing risks.

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