Consumer Finance

Nov 30, 2012 (LBO) - Fitch Ratings has confirmed a BBB+(lka) rating of Sri Lanka's Singer Finance (Lanka) Plc, with a stable outlook, based on an 80 percent holding and strong links with its parent, Singer (Sri Lanka) Plc, which is rated A(lka) with a stable outlook. In 2012 SFL's portfolio has expanded 53 percent with vehicle financing (79.1 percent of the total) with consumer finance loans at 18.4 percent of the total.

Its non-performing loans (NPLs) overdue for three months had risen to 2.7 percent in the first half of the 2013 financial year, up from 1.7 percent at the end of the 2012 financial year.

"NPLs were made up largely of hire purchases and leases," Fitch said.

"The asset quality of consumer loans has been strong. Fitch expects SFL's asset quality to compare favourably with that of the sector, due to strong credit monitoring and controls."

Its gross NPL ratio over six months was below 0.5 percent, which Fitch said was better than similarly rated peers.

The full statement is reproduced below:

Fitch Affirms Singer Finance at 'BBB+(lka)'; Outlook Stable

Fitch Ratings-Colombo/Seoul/Singapore-29 November 2012: Fitch Ratings Lanka has affirmed Singer Finance (Lanka) PLC's (SFL) National Long-Term rating at 'BB