Fitch Ratings has assigned Sampath Bank PLC’s (A+(lka)/Negative) proposed Basel III-compliant subordinated debentures a National Long-Term Rating of ‘A(lka)’.
The final rating is the same as the expected rating assigned on 18 September 2017, and follows the receipt of documents conforming to information already received. The notes, the first Basel III-compliant subordinated debt in Sri Lanka, will total Rs 6 billion, mature in five years and carry fixed coupons. The notes include a non-viability clause, and will qualify as regulatory Tier II capital for the bank.
The bank plans to use the proceeds to support its loan book expansion and to strengthen its Tier II capital base. The debentures are to be listed on the Colombo Stock Exchange. itch rates the proposed Tier II instrument one notch below the bank’s National Long-Term Rating of ‘A+(lka)’ to reflect the notes’ subordinated status and higher loss-severity risks relative to senior unsecured instruments. The notes would convert to equity upon the occurrence of a trigger event, as determined by the Monetary Board of Sri Lanka.
Sampath’s National Long-Term Rating is used as the anchor rating because the rating reflects the bank’s standalone financial strength.
0 comments: