Fitch re-affirms People’s Bank at ‘AA+(lka)’, Outlook Stable

Fitch Ratings Lanka Ltd. recently re-affirmed the National Long Term Rating on People’s Bank at ‘AA+(lka)’ with a Stable Outlook – continuing to put the institution amongst the two highest-rated locally-incorporated commercial banks in the country on a national scale.

In its Rating Announcement the agency stated: “The National Long-Term Rating of People’s Bank reflects Fitch’s expectation of extraordinary support from the sovereign (B+/Negative) albeit constrained by its limited ability. Fitch expects support for People’s Bank to stem from its high systemic importance, quasi-sovereign status, role as key lenders to the Government and full State-ownership.” 

Commenting on the affirmation, People’s Bank Chairman Hemasiri Fernando stated: “The evolution of the bank’s rating provides a simple but powerful testimony to an irrefutable fact. Having been rated ‘A- (lka)’ during 2008, to having received an industry unprecedented systematic five notch upgrade to reach ‘AA+ (lka)’ by the end of 2012, and a capacity to consistently maintain this credit quality thereafter since, notwithstanding the many challenges from a macro-economic stand-point, self attests to both the consistent and sustained positive progress made by the Institution over the years. “As for 2016, it will be a year etched in our history books for many reasons. Amongst them all, it will be best remembered as the year that witnessed not only a single trillion rupee feat but in fact two. Following its first trillion rupee landmark achievement in terms of consolidated group assets in 2013, during the year 2016, the bank saw not only its customer deposits reach this historic milestone but also its group customer advances. This provides ample evidence to our standing within the industry – supported by our unmatched network of branches spread across all major cities and suburbs in the country.  “It must be also said, amongst our many successes, we are also most proud to be the industry’s largest employer. The passion and commitment of our employees to serve the people of the nation and their businesses is what consciously and very diligently drives us forward. We thank you all. On behalf of the Board of Directors, I take the opportunity to extend our sincerest appreciation to all our valued stakeholders for their trust and confidence in our efforts.”

Commenting on the bank’s performance, People’s Bank Chief Executive Officer/General Manager Vasantha Kumar stated: “Our delivery amidst challenging circumstances remains best described in two simple but primary indicators. First, an industry benchmark return on equity of over 20% delivered consistently since 2014 and second, a consciously and very diligently reduced gross non-performing loan ratio to less than 2.0% – which is not only our 10-year low but also amongst the lowest in the industry. Not complacent with our successes and conscious of the challenges that may lie ahead, our focus is clear and is to make every effort necessary and within our reasonable control to help all our customers and their businesses continuously prosper.”