Lanka Rating Agency
29-Oct-24
Analyst
Gayani Randima Ariyawansa
gayani@lra.com.lk
+94 114 500099
www.lra.com.lk
Applicable Criteria
- Methodology | Structured Finance Rating | Jun-22
Related Research
- Sector Study | Leasing & Finance Companies | Aug-24
This press release is being transmitted for the sole purpose of dissemination through print/electronic media. The press release may be used in full or in part without changing the meaning or context thereof with due credit to LRA
Lanka Rating Withdraws the Debt Instrument Rating of Asia Asset Finance PLC LKR 600Mn Asset Backed Secured Trust Certificates
| Rating Type | Debt Instrument | |
|
Current (29-Oct-24) |
Previous (27-Jan-23) |
|
| Action | Withdraw | Initial |
| Long Term | - | A |
| Outlook | Stable | |
| Rating Watch | - | - |
Subsequent to the management's decision to discontinue the rating, Lanka Rating withdraws the Debt Instrument Rating of Asia Asset Finance PLC LKR 600Mn Asset Backed Secured Trust Certificates with immediate effect.
About
the Entity
Asia Asset Finance PLC is a public limited liability company incorporated and domiciled in Sri Lanka and listed on the Colombo Stock Exchange. In 2014 AAF was acquired by MFL of India, and it had a 73% stake in the Company as of FY23. The principal activities of AAF comprise gold loans, SME Loans, Leasing, Micro Finance, Personal Loans, and Pledge Loans. The Board of Directors consists of eight members of which three are Non-Independent and Non- Executives Directors and four are Independent and Non-Executive Directors. The remaining is the Chief Executive Officer, Mr. Rajiv Gunawardena, who heads the management team, and he has held the current position as the CEO for about 12 years.
About
the Instrument
AAF has raised LKR 600Mn by securitizing gold loan receivables up to 130% of the certificate with a tenure of the 3 years. The trust certificate was issued in three tranches. The coupon rates are fixed at 10.15% and 10% for tranche 1, 10% for tranche 2 and 12.50% for tranche 3 and will be paid annually. The issue date is 07th October 2021. The last coupon payment and capital payment will go out in October 2024. The objective of the issue is for the purpose of supporting the expansion of gold loan portfolio.