SriLankan Airlines government guaranteed bonds rated ‘BB-‘
ECONOMYNEXT – Fitch Ratings said it has confirmed the rating on SriLankan Airlines Limited’s (SLA) US dollar-denominated government guaranteed bonds at ‘BB-‘.
The national carrier’s bonds are rated at the same level as its parent, the state of Sri Lanka, due to the unconditional and irrevocable guarantee of principal and interest of the notes provided by government, Fitch said.
The state held 99.5 percent of SLA through direct and indirect holdings at end-2015.
The national airline has a 72 percent share of the total airline seating capacity of the country, Fitch said in a statement.
“The government has identified tourism as a key economic growth driver in the medium term; and the company is well positioned to capture the benefits of this trend as the leading airline in Sri Lanka.”
Tourist arrivals to Sri Lanka rose to 1.8 million in 2015 from 1.0 million in 2012.
Fitch said developments that may lead to negative rating action include negative rating action on the Sri Lankan sovereign and to positive rating action include positive rating action on the Sri Lankan sovereign.