Fitch assigns ComBank’s Rs.7bn debt issue final ‘AA-(lka)’

Fitch Ratings Lanka has assigned Commercial Bank of Ceylon PLC’s (AA(lka)/Stable) proposed Basel II-compliant subordinated debentures of up to Rs.7 billion a final national long-term rating of ‘AA-(lka)’.

The final rating is the same as the expected rating assigned on August 3, 2016, and follows the receipt of documents conforming to information already received. 

The proposed issuance, which will have tenures of five and 10 years and carry fixed coupons, will be listed on the Colombo Stock Exchange.The bank expects to use the proceeds to fund loan expansion, reduce asset and liability maturity mismatches and increase its Tier II capital base.

The issue is rated one notch below the bank’s national long-term rating, to reflect the subordination to senior unsecured creditors.