Fitch Ratings has downgraded the National Long-Term Ratings of 10 Sri Lankan banks following the recent sovereign downgrade and recalibration of the agency’s Sri Lankan national rating scale.

The recalibration is to reflect changes in the relative creditworthiness among Sri Lankan issuers following Fitch’s downgrade of Sri Lanka’s Long-Term Local Currency Issuer Default Rating (IDR) to ‘CC’ from ‘CCC’/Under Criteria Observation on 1 December 2022.

The rating agency said it typically does not assign Outlooks or apply modifiers to sovereigns with a rating of ‘CCC+’ or below.

National scale ratings are a risk ranking of issuers in a particular market designed to help local investors differentiate risk. Sri Lanka’s national scale ratings are denoted by the unique identifier ‘(lka)’.

Fitch adds this identifier to reflect the unique nature of the Sri Lankan national scale.

National scales are not comparable with Fitch’s international rating scales or with other countries’ national rating scales.

The National Ratings of the Sri Lankan banks consider their creditworthiness relative to other issuers in the country. The recalibration of the Sri Lankan National Rating scale has resulted in downgrades of the National Long-Term Ratings of the following banks:

– Bank of Ceylon
– People’s Bank
– Commercial Bank of Ceylon PLC
– Hatton National Bank PLC
– Sampath Bank PLC
– Cargills Bank Limited
– National Development Bank PLC
– Seylan Bank PLC
– Nations Trust Bank PLC

Meanwhile, other Sri Lankan banks’ national ratings, which are not mentioned in this commentary, have not been affected by the recalibration exercise.


Fitch downgrades Sri Lanka’s local currency debt rating to ‘CC’