(State-owned People’s Bank subsidiary People’s Leasing & Finance PLC (PLC) is to raise Rs.6 billion through a proposed senior unsecured debenture issue.
Fitch Ratings has assigned AA-(lka) (EXP) for the issue in line with PLC’s national long-term rating.
PLC expects to use the proceeds for working capital purposes, to diversify its funding mix, and to reduce maturity mismatches.
The issue is expected to have tenors of four and five years with fixed-rate coupon payments.
In 2014, PLC accounted for about 10 percent of People’s Bank group assets, and contributed about 17 percent of its post-tax profits. Apart from its own branches, PLC also operates 109 window offices within branches of People’s Bank.
It is likely that state support will flow to PLC through People’s Bank due to their strong linkages.
