Fitch Ratings has assigned Sri Lanka-based People’s Leasing and Finance PLC’s proposed Sri Lankan rupee-denominated subordinated listed debenture issue of up to Rs. 10 billion a final National Long-Term Rating of ‘BBB+(lka)’.
The proposed debentures will mature in five years and will be listed on the Colombo Stock Exchange. The company plans to use the proceeds to further strengthen its Tier 2 capital base and to maintain capital adequacy compliance.
The proposed debentures are rated two notches below People’s Leasing and Finance PLC’s National Long-Term Rating.
The ratings agency said: ‘This reflects our baseline notching for loss severity for this debt class and our expectation of poor recoveries in the event of default.
We applied our Bank Rating Criteria to rate the proposed debentures, as we believe the prudential capital framework of Sri Lankan finance companies is close to that for banks. There is no additional notching for non-performance risk, as the proposed debentures do not contain going-concern loss-absorption features.
The final rating is the same as the expected rating assigned on 8 May 2026 and follows the receipt of documents conforming to information already received.
People’s Leasing and Finance PLC’s National Long-Term Rating was upgraded to ‘A(lka)’ from ‘A-(lka)’ on 24 January 2025 following the upgrade of its parent, People’s Bank (Sri Lanka), to ‘AA-(lka)’ from ‘A(lka)’. People’s Leasing and Finance PLC’s rating reflects Fitch’s expectation of extraordinary support from People’s Bank, if needed, based on the parent’s majority shareholding, People’s Leasing and Finance PLC’s synergistic role, and shared branding, offset by the subsidiary’s significant size relative to People’s Bank.
A downgrade of People’s Leasing and Finance PLC’s National Long-Term Rating would lead to a downgrade of the subordinated debt rating.
An upgrade of People’s Leasing and Finance PLC’s National Long-Term Rating would lead to an upgrade of the subordinated debt rating.’