Fitch maintains National Rating of Bank of Ceylon at ‘A(lka)’

Fitch Ratings (Fitch) has affirmed Bank of Ceylon’s (BoC) Long-Term Foreign-Currency Issuer Default Rating (IDR) at ‘CC’ on June 13, 2023.

At the same time, Fitch has maintained BOC’s Long-Term Local-Currency IDR of ‘CCC-’ and National Rating of ‘A(lka)’ on Rating Watch Negative (RWN).Fitch has also affirmed BOC’s Short-Term IDR at ‘C’, Viability Rating (VR) at ‘cc’ and Government Support Rating at ‘ns’.

The Bank’s Long-Term Local-Currency IDR is one notch above that of Sri Lanka, reflecting a lower risk that the authorities will impose restrictions on banks servicing their local-currency obligations than non-payment by the sovereign.

Fitch has further stated that the Bank’s local-currency funding and liquidity position is currently more manageable and the stress on foreign-currency liquidity has eased as reflected in the bank having met its obligations. As Sri Lanka’s premier financial service organization with over eight decades of leadership in the industry, BoC’s contribution to the social-economic prosperity of Sri Lanka is remarkable.

The Bank has reported Rs. 32.0 billion of Profit After Tax (PAT) for the year ended 31 December 2022 and Rs. 3.3 billion of PAT for the three-month period ended March 31, 2023 amidst the unprecedented challenges that have continued to prevail from the last few years.

The Bank has not transferred the full impact of market interest rate hike to its loyal customers in order to sustain their lives and revive their businesses in this difficult era despite the negative effect to the bottom line.

Despite never experienced challenges the Bank has been able to maintain its position and steering the Bank strongly and prudently in the next few years is of utmost importance and is on a pathway to stable growth with a growing market share and an increasing asset base made possible through scaling up of digitization, pursuit of operational efficiencies, and expert capacity of the cadre.