Sampath's capitalisation levels have decreased due to loan growth (28 percent annualised) during the first nine months of 2006, the risk evaluator said.
Equity/assets ratio was 6.8 percent in Q306 against 7.4 percent at FYE05. Core and total capital adequacy ratios were 8.65 percent and 11.46 percent in Q306 against 10.86 percent and 15.14 percent at FYE05, respectively.
However, the agency notes that at the bank level, total capital adequacy ratio was only 10.29 percent in Q306, marginally above the regulatory minimum of 10.0 percent.
Sampath's profitability as measured by return on assets has been maintained at 1.2 percent in Q306 due to improved operational efficiency despite a slight decrease in net interest margins as well as higher effective taxes.
Further, its gross non-performing loan (NPL) ratio compares well with peers at 5.2 percent in Q306 against 5.9 percent at FYE05.
Sampath has also maintained a high loan loss reserve/NPL coverage of 86.4 percent in Q306 and 82.4 percent at FYE05.
Consequently, its solvency as indicated by net NPL/equity, improved to 7.2 percent in Q306 from 9.5 percent at FYE05 which compares well against peers.
Sampath commenced operations in 1987 with a public issue and listing of shares on the Colombo Stock Exchange.
It is the seventh-largest commercial bank in Sri Lanka, commanding a 5- percent market share of banking system assets.
Sampath has a network of 95 branches complimented by technology-based delivery channels such as 130 ATMs, tele-banking and internet banking.
It has a 30.8 percent stake in Lankabangala Finance Limited, a non-bank financial institution based in Bangladesh engaged in leasing and issuing of credit cards, and a 24.6 percent stake in another LCB, Union Bank of Colombo Ltd (rated BB+(lka) by Fitch).