Lanka Rating Agency upgrades First Capital Treasuries to A+

From left: LRA Financial Analyst Imran Iqbal, LRA Head of Rating Gayani Ariyawansa, LRA CEO Dr. Kenneth De Zilwa, FCT Director/CEO Sachith Perera, FCT COO Tharusha Ekanayake, FCT CFO Mangala Jayashantha and First Capital Holdings Managing Director/CEO Dilshan Wirasekara

First Capital Treasuries PLC (FCT) and Lanka Rating Agency Ltd (LRA) jointly announced the upgrade of FCT’s credit rating to ‘A+’, from ‘A’, reflecting the company’s strengthened financial position, robust risk management practices and continued excellence in Sri Lanka’s capital markets.

The ‘A+’ rating represents a significant milestone, indicating FCT’s very strong capacity to meet its financial commitments. This upgrade is particularly noteworthy, as it comes during a period of economic adjustment for Sri Lanka.

“This rating upgrade validates our strategic focus on sustainable growth and prudent risk management,” said First Capital Holdings Managing Director/CEO Dilshan Wirasekara. 

“Despite market volatilities, we have maintained our commitment to excellence in serving our clients while strengthening our financial fundamentals. The A+ rating will further enhance stakeholder confidence in our operations and support our ongoing mission to deliver exceptional value to all our stakeholders while contributing to the development of Sri Lanka’s capital markets.”

LRA CEO Dr. Kenneth De Zilwa said, “FCT has demonstrated remarkable financial discipline and strategic foresight in navigating complex market conditions. Our rating committee was particularly impressed by the company’s robust capital position, sophisticated risk management framework and consistent performance metrics. The upgrade to A+ reflects our confidence in the company’s ability to maintain its strong market position while managing potential risks effectively.”

The company enjoyed an exceptional year in terms of profitability in FY24, on the back of substantial trading gains on government bonds, due to a sharp decline in interest rates. The company’s profit after tax (PAT) in FY24 stood at LKR~11.1 billion, compared to LKR~2.9 billion in FY23. The performance trends normalised but remained strong (after the one-off gains in FY24) as FCT posted a PAT of LKR~2.5 billion in 9MFY25. The company’s direct income was LKR~8.6 billion in 9MFY25 while direct expense (interest costs) stood at LKR~4.8 billion in 9MFY25, showing a decline of ~17.8 percent, from LKR~5.8 billion in 9MFY24. FCT recorded a healthy capital adequacy ratio of ~17.95 percent in 9MFY25. This is well above the statutory requirement of 10 percent.