Sri Lanka Abans Finance’s debt issue rated A-(lka) by Fitch

Fitch Ratings has assigned Abans Finance’s proposed debenture issue of 1.5 billion rupees a National Long-Term Rating of A-(lka).

The debentures are rated at the same level as Abans Finance’s rating.

“This is because the issue ranks equally with the claims of the company’s other senior unsecured creditors,” Fitch Ratings said.

The debentures will be listed on the Colombo Stock Exchange.

The full statement is reproduced below:

Fitch Assigns Abans Finance’s Proposed Senior Debt a Final ‘A-(lka)’ Rating

Fitch Ratings – Singapore/Colombo: Fitch Ratings has assigned Abans Finance PLC’s (A-(lka)/Stable) proposed Sri Lankan rupee-denominated senior unsecured debentures of up to LKR1.5 billion a final National Long-Term Rating of ‘A-(lka)’.

The final rating is the same as the expected rating published on 9 December 2025 for the same debt class and follows the receipt of documents conforming to information already received.

Key Rating Drivers

The proposed debentures will mature in five years and will be listed on the Colombo Stock Exchange. The company plans to use the proceeds to support loan-book expansion.

The proposed debentures are rated at the same level as Abans Finance’s National Long-Term Rating in accordance with Fitch’s criteria. This is because the issue ranks equally with the claims of the company’s other senior unsecured creditors.

Fitch upgraded Abans Finance’s National Long-Term Rating to ‘A-(lka)’, from ‘BBB+(lka)’, on 24 January 2025 following the upgrade of the parent, Abans PLC, to ‘AA(lka)’, from ‘AA-(lka)’. Abans Finance’s rating reflects Fitch’s expectation of extraordinary support from Abans, if needed, based on the parent’s majority shareholding, its involvement in Abans Finance’s strategic decisions through board representation and shared branding.

Abans Finance is rated four notches below its parent due to its limited strategic importance and negligible contribution to the parent’s consumer‑durables revenue. Fitch believes Abans Finance may remain a potential medium‑term disposal candidate, despite the parent holding a 50.2% stake following a 2022 rights issuance and earlier divestment efforts.

Please refer to our commentary, Fitch Upgrades 10 Sri Lankan NBFIs’ Ratings, Affirms 8 Following National Scale Recalibration, published 24 January 2025, for details on Abans Finance’s key rating drivers and sensitivities.

RATING SENSITIVITIES

Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade

A downgrade of Abans Finance’s National Long-Term Rating would lead to a downgrade of the proposed debenture rating.

Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade