Fitch affirms HSBC Sri Lanka Branch at ‘AAA’/Stable

Fitch Ratings Lanka has affirmed HSBC Sri Lanka Branch’s (HSBCSL) National Long-Term rating at ‘AAA(lka)’. The Outlook is Stable.

The rating reflects the financial strength of the HongKong & Shanghai Banking Corporation Limited (HKB; Long-Term Issuer Default Rating (IDR): ‘AA’/Negative), given that HSBCSL is a branch of HKB and is part of the same legal entity as HKB.

Thus, Fitch believes that support from HKB would be forthcoming if required, subject to any regulatory constraints on remitting money into Sri Lanka.

The affirmation of HSBCSL’s rating follows the Outlook revision on HKB’s IDR to Negative from Stable on 1 March 2012, and the simultaneous affirmation of its Support Rating Floor at ‘A-’ (please see the rating action commentary on www.fitchratings.com). HKB continues to be rated above Sri Lanka’s sovereign IDR of ‘BB-’/Stable.

Established in 1892, HSBCSL is Sri Lanka’s largest foreign bank branch.