Fitch Rating puts Ceylease on ‘Watch Positive’
View(s):Fitch Ratings Lanka has placed Ceylease Ltd’s (CL) National Long-Term Rating of ‘BB+(lka)’ on Rating Watch Positive (RWP) and has affirmed MCSL Financial Services Ltd’s (MFSL) National Long-Term Rating at ‘BBB(lka)’ with a ‘Stable Outlook’.
This follows the announcement of the proposed merger between the two entities, according to a Fitch media release.
Fitch said it will upgrade CL’s rating to align with MFSL’s rating upon the conclusion of the merger. This is based on Fitch’s expectations that Bank of Ceylon (BOC; ‘AA+(lka)’/Stable), parent to both MFSL and Ceylease, will maintain a dominant effective shareholding in and continue to provide support to the merged entity.
“The affirmation of MFSL’s rating reflects Fitch’s view that support from its parent BOC will remain unchanged, despite a change to its shareholding in MFSL after the merger,” it said.
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