Wednesday, 20 November 2013 07:13
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The Rs. 2 billion listed debenture issue of LB Finance Plc was snapped up and was closed on its official opening day yesterday.
The company said it had received applications worth over Rs. 2 billion and following oversubscription the issue closed by 4:30 p.m. yesterday.
RAM Rating Lanka has assigned BBB+ to LB Finance’s Rs. 2 billion five year debentures.
LB Finance issued 10 million unsecured, subordinated, redeemable debentures at Rs. 100 each with an option to offer a further equal amount in the event of the initial amount being oversubscribed.
RAM Ratings has also reaffirmed LB Finance PLC’s (LBF) respective long- and short-term financial institution ratings at A- and P2. Concurrently, a long term rating of BBB+ has been reaffirmed to LB Finance’s issued Rs. 545 million Unsecured Redeemable Subordinated Debentures (2011/2016).
All the long-term ratings are to carry a stable outlook.
The ratings are upheld by LBF’s strong market position among licensed finance companies in Sri Lanka, its strong franchise, above-average asset quality and average performance.
RAM said LBF’s capitalisation levels are above average. Its tier-1 and overall RWCAR levels clocked in at 14.02% and 15.40%, respectively as at end-FY March 2013 (FY Mar 2012: 12.53% and 14.81%) and dipping to 11.79% and 13.06% as at end-August 2013 amidst loan growth and compared better than peers.
Going forward, overall RWCAR is expected to improve in view of moderate loan growth coupled with the planned issuance of subordinated debentures.
