Fitch Affirms Citibank Colombo at ‘AAA (lka)’; Outlook Stable | Daily News


 

Fitch Affirms Citibank Colombo at ‘AAA (lka)’; Outlook Stable

Fitch Ratings Lanka has affirmed Citibank N.A. - Colombo Branch’s (CitiSL) National Long-Term Rating at ‘AAA (lka)’. The Outlook is Stable.

The affirmation reflects CitiSL’s status as a branch of Citibank, N.A. (A+/Negative/a), which means it is part of the same legal entity. Fitch expects continued timely support for CitiSL from its US-based head office, if required, subject to any regulatory constraints on remitting funds into Sri Lanka.

The high probability of support also stems from the alignment of CitiSL’s objectives and strong operational integration with Citigroup. The small size of the branch, at less than 1% of Citibank’s total assets, implies that support would not be material to the head office. Citibank, N.A.’s credit profile is superior to Sri Lanka’s rated universe of issuers, including the sovereign (B-/Negative); as a result, CitiSL’s rating is at the highest end of the National Rating scale for Sri Lanka.

The economic fallout from the coronavirus pandemic will pressure CitiSL’s earnings and profitability, with lower fee-based income, muted loan growth and higher credit costs.


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