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Fitch Ratings Lanka has assigned an AA-(sri) entity rating for DFCC Vardhana Bank, a subsidiary of DFCC Bank. With a ‘stable ratings outlook’, an AA- (sri) rating indicates low credit risk and a strong capacity to honour financial commitments, Fitch said Tuesday.
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Fitch says the rating stems from the strong support by Vardhana Bank’s parent company DFCC Bank (currently rated AA(sri) by Fitch).
In addition to DFCC’s 94 percent shareholding, and the use of a common name, operationally, Vardhana Bank is closely enmeshed with its parent.
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The group shares its branch network and offers a seamless service to its customers.
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Vardhana Bank is expected to play an important strategic role in DFCC’s future plans.
On this basis Fitch takes the view that Vardhana Bank will enjoy a high degree of business and financial support from parent DFCC.
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Prior to its acquisition by DFCC in September 2003, Vardhana Bank operated as MERC bank.
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Although MERC was in existence since 1996, the bank had