Fitch Assigns 'A-(lka)' to PLC's Proposed Senior Debt

Fitch Ratings Lanka has today assigned a National Long-term rating of 'A-(lka)' to People's Leasing Company Ltd's (PLC) proposed senior unsecured redeemable debentures of up to LKR500m. PLC's National Long-term rating is 'A-(lka)', and the Outlook is Stable.

The proceeds from the issue will be utilised to fund the growth of PLC's lease, hire purchase, and loan portfolio. The issue features semi-annual coupon interest payments, a four-year tenure, and capital redemption at maturity. Furthermore, the coupon interest payments on the debt issue are limited by way of an interest rate cap and floor, which limits the company's exposure to potential interest rate volatility, up to the issued amount.

PLC is one of Sri Lanka's largest specialised leasing companies, with assets amounting to over LKR32bn at 31 March 2010. PLC is wholly owned by People's Bank (rated 'A(lka)'/Stable).

For a detailed credit profile of PLC, please refer to Fitch's Credit Update report dated 15 March 2010 at Fitch's website, www.fitchratings.com.

People's Bank owns a 1.78% share in Fitch Ratings Lanka Limited. No other shareholder, other than Fitch Ratings Limited of the UK, is involved in the day-to-day operations of, or credit rating reviews undertaken by, Fitch Ratings Lanka Limited.

Applicable Criteria available on Fitch's website, at www.fitchratings.com: "Global Financial Institutions Rating Criteria", and "Finance and Leasing Company Criteria", both dated December 29, 2009.