At least 22 individuals have sustained injuries following a collision involving a passenger bus, a container truck, and a fuel bowser in the vicinity of Nittambuwa.
The accident unfolded in the Kajugama area, situated along the Colombo-Kandy main road. Law enforcement authorities have reported that the injured victims are currently undergoing medical treatment at Wathupitiwala Hospital.
The initial collision transpired between a passenger bus, which was traveling from Ampara to Colombo, and a container truck, resulting in a head-on collision of immense impact. The situation further exacerbated as a container truck, en route to Colombo, subsequently rear-ended the already beleaguered bus.
Four of the injured individuals have been classified as being in critical condition. These casualties have been admitted to the Wathupitiwala Base Hospital, where medical teams are working tirelessly to provide them with the necessary care.
As Sri Lanka joins the world in celebrating World Teachers’ Day today. This year’s theme, “The teachers we need for the education we want: The global imperative to reverse the teacher shortage,” underscores the critical need for more teachers in the country.
With over 4.3 million school children to educate, Sri Lanka currently has just 247,000 government teachers, highlighting a stark mismatch in teacher-student ratios. The shortage of 45,000 teachers has posed significant challenges for the education sector, with trade unions pointing out disruptions in academic activities.
Recognizing the urgency of the situation, the Ministry of Education has announced several measures to address the teacher shortage. Applications have been invited to recruit 5,450 teachers specializing in A/Level science, mathematics, and foreign languages. Additionally, the ministry plans to fill the gaps created by teachers who retired or resigned this year by hiring 4,000 more teachers. Furthermore, a decision has been made to recruit 542 academic graduates to bolster the teaching service.
Colombo (LNW): Sri Lanka is in a quandary following the International Monetary Fund’s (IMF) delay in disbursement of the second tranche of US$330 of the $ 3 billion Extended Facility till next month due to inconclusive first review on the progress of economic reform programme.
The much-sought after bailout loan of $330 the million by Colombo from the International Monetary Fund (IMF) has not materialized ostensibly after Beijing’s refusal to restructure bilateral loans it extended to the Indian Ocean Island, informed sources said
But the Central Bank Governor Nandalal Weerasinghe said that India Paris Club and China debt restructuring negotiations are continuing with “very impressive progress.
IMF staff level agreement will also be reached soon following the settlement of ‘few matters including the achievement of some targets as soon as possible, he claimed.
But the IMF has been insisting that Sri Lanka should get an assurance from its biggest bilateral lenders – China, Japan and India – that they will restructure their loans before possible IMF funding. Colombo, despite many requests, now finds that Beijing is unwilling to provide it with “a concrete debt relief framework”, says a report in Nikkei Asia.
However the government is likely to reach a debt reduction deal this month with India, Japan and France to be in time for the IMF and the World Bank’s meetings later this month in Morocco. China has not joined the group by remaining an observer, official sources said.
If China opts out of the deals to provide support to Sri Lanka in managing its external loans, it could cast a shadow over its IMF bailout plans as China holds 42 per cent of the island nation’s external debt.
Now the stakes are rising for an expected mid-October visit to China by President Ranil Wickremesinghe to attend a 10th anniversary summit of the Belt and Road Initiative, Beijing’s regionwide infrastructure building program. He is due to meet Chinese President Xi Jinping to discuss debt relief.
In its statement on the review, the IMF did not point fingers. But multiple diplomatic sources from Asian and Western missions in Colombo told Nikkei Asia that China’s foot-dragging on Sri Lanka’s debt was an issue.
“The other lenders were OK with this arrangement and were prepared to let Colombo deal with Beijing at a bilateral level,” the diplomat added. “But there cannot be any special deals favoring Chinese debt terms, such as no haircuts, yet expecting haircuts from the other countries.”
Mr Wickremesinghe – who stepped into the role of president in the middle of last year — has assured bilateral lenders of equal treatment. The incumbent then, Gotabaya Rajapaksa, had fled in the wake of unprecedented street protests driven by public anger over the collapsed economy.
Within the group of countries besides China, diplomatic sources familiar with the talks revealed that concrete progress on a blueprint and timeline is still elusive.
Showers or thundershowers will occur at times in Western, Sabaragamuwa, Southern and North-western provinces and in Kandy and Nuwara-Eliya districts.
Fairly heavy showers above 50mm can be expected at some places in Galle, Matara, Kalutara and Ratnapura districts.
Showers or thundershowers will occur at several places in Eastern and Uva provinces, and in Polonnaruwa, Matale and Mullaitivu districts during the evening or night.
General public is kindly requested to take adequate precautions to minimize damages caused by temporary localized strong winds and lightning during thundershowers.
Fitch Ratings has affirmed Bank of Ceylon’s (BOC) Long-Term Local-Currency Issue Default Rating (IDR) at ‘CCC-’ and removed it from Rating Watch Negative (RWN). The Outlook is Stable.
At the same time, Fitch has affirmed the National Long-Term Ratings of the following banks, removed them from RWN and assigned Stable Outlooks:
– BOC at ‘A(lka)’
– People’s Bank (Sri Lanka) at ‘A(lka)’
– Commercial Bank of Ceylon PLC at ‘A(lka)’
– Hatton National Bank PLC at ‘A(lka)’
– Sampath Bank PLC at ‘A(lka)’
– National Development Bank PLC at ‘A-(lka)’
– Seylan Bank PLC at ‘A-(lka)’
– DFCC Bank PLC at ‘A-(lka)’
– Nations Trust Bank PLC at ‘A-(lka)’
– Pan Asia Banking Corporation PLC at ‘BBB-(lka)’
– Union Bank of Colombo PLC at ‘BBB-(lka)’
– Amana Bank PLC at ‘BB+(lka)’
– Sanasa Development Bank PLC at ‘BB+(lka)’
– Housing Development Finance Corporation Bank of Sri Lanka at ‘BB+(lka)’
Fitch has also affirmed Cargills Bank Limited’s (CBL) National Long-Term Rating at ‘A(lka)’ and removed it from RWN. Fitch has assigned a Negative Rating Outlook.
The RWN on these banks’ senior and subordinated debt ratings, where assigned, has also been removed.
BOC’s Long-Term Foreign-Currency IDR of ‘CC’, Short-Term IDR of ‘C’, Viability Rating of ‘cc’ and Government Support Rating of ‘ns’ were not considered in this review.
A full list of rating actions is at the end of this rating action commentary.
KEY RATING DRIVERS
Downside Risks to Banks Easing: The removal of the RWN on BOC’s Long-Term Local-Currency IDR and the national ratings of all the above banks reflects our view that near-term downside risks have substantially reduced as reflected in the upgrade of Sri Lanka’s Long-Term Local-Currency IDR to ‘CCC-’ from ‘RD’. Please see Fitch Upgrades Sri Lanka’s Long-Term Local-Currency IDR to ‘CCC-’, published 28 September 2023.
The successful conclusion of the local-currency sovereign debt restructuring, including the exclusion of banks’ holdings of treasury securities from the domestic debt optimisation programme, has alleviated some of the pressure on the banks’ capital positions from weakening loan quality and rupee depreciation as well as any immediate funding and liquidity stresses.
Manageable Risks from Foreign-Currency Bonds: The restructuring of Sri Lanka’s foreign-currency debt, including the defaulted sovereign bonds that banks hold, has not been completed, but we believe that incremental risks to banks’ capital from the restructuring are likely to be manageable, given their limited exposure to these bonds (3.6% of total assets at end-1H23) and high provision coverage. That said, access to foreign-currency wholesale funding remains challenged by the sovereign’s weak credit profile, but the stress on banks’ foreign-currency liquidity has largely eased relative to the crisis period.
Negative Outlook on CBL: The Negative Outlook on CBL’s national rating reflects downside risks from its increasing size relative to that of its ultimate parent, CT Holdings PLC (CTH), which could constrain the parent’s ability to provide extraordinary support in times of need. At end-1H23, the bank’s assets accounted for 193% of group equity and 51% of group assets.
The removal of parental support considerations due to rising relative size could result in a downgrade of CBL’s rating to a level that reflects its standalone credit strength. Fitch views this to be significantly weaker than the support-driven rating of ‘A(lka)’ due to its weak financial profile and small and developing franchise.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade
BOC’s Long-Term Local-Currency IDR
Fitch would downgrade BOC’s Long-Term Local-Currency IDR if we perceive there is an increased likelihood that the bank would default on or seek a restructuring of its local-currency denominated senior obligations to non-government creditors.
National ratings of all banks, except CBL
A deterioration in the banks’ key credit metrics beyond our base-case expectations relative to peers could trigger a downgrade on the banks’ ratings, which are driven by their intrinsic financial strength.
National rating of CBL
CBL’s rating is sensitive to changes in CTH’s credit profile as well as Fitch’s opinion around the ability or propensity of CTH to extend timely extraordinary support. A continued increase in CBL’s balance sheet relative to that of CTH that makes extraordinary support more onerous for the parent, could lead to a multiple-notch downgrade in CBL’s national rating to reflect its standalone credit strength.
Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade
BOC’s Long-Term Local-Currency IDR
An upgrade of BOC’s Long-Term Local-Currency IDR would most likely result from an improvement in Sri Lanka’s operating environment, which could occur after the successful completion of the restructuring of the remainder of the foreign-currency sovereign debt.
National ratings of all banks, except CBL
Positive rating action on the sovereign may lead to an upgrade in the banks’ ratings. A sustained improvement in the banks’ key credit metrics beyond our base-case expectations relative to peers, could also lead to an upgrade of the banks’ ratings.
National rating of CBL
There is limited upside potential given the Negative Outlook on the bank’s national rating.
BOC and PB have a 1.78% equity stake each in Fitch Ratings Lanka Ltd. No shareholder other than Fitch, Inc. is involved in the day-to-day rating operations of, or credit reviews undertaken by, Fitch Ratings Lanka Ltd.
OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS
RWN Removed on Senior Debt Ratings: Fitch has also taken corresponding rating action on the banks’ national scale senior debt ratings, where assigned. Sri Lanka rupee-denominated senior debt, where applicable, is rated at the same level as the banks’ National Long-Term Ratings in accordance with Fitch’s criteria. This is because the issues rank equally with the claims of the banks’ other senior unsecured creditors.
SUBORDINATED DEBT
The removal of the RWN on the banks’ outstanding and proposed subordinated debt, where applicable, corresponds to the action taken on these banks’ national ratings. Sri Lanka rupee-denominated subordinated debt, where applicable, is rated two notches below banks’ National Long-Term Ratings. This is in line with our baseline notching for loss severity for this type of debt and our expectations of poor recovery.
OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES Senior and subordinated debt ratings will move in tandem with the National Long-Term Rating
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING The principal sources of information used in the analysis are described in the Applicable Criteria.
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS CBL’s National Long-Term Rating is driven by support from its ultimate parent, CTH.
ESG CONSIDERATIONS
BOC has an ESG Relevance Score of ‘4’ for Governance Structure due to ownership concentration, with a 100% state shareholding and several related-party transactions with the state and state-owned entities, which has a negative impact on the credit profile and is relevant to the rating in conjunction with other factors.
BOC has an ESG Relevance Score of ‘4’ for Financial Transparency. It reflects our view that the recent regulatory forbearance measures announced by the Central Bank of Sri Lanka could distort the true solvency and liquidity position of the bank, thereby limiting financial transparency. This has a negative impact on the credit profile and is relevant to the rating in conjunction with other factors.
Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of ‘3’. This means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch’s ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision.
In a morning incident today, at least 17 individuals sustained injuries when a tree toppled onto a bus in Colombo, with two passengers still trapped inside.
A joint rescue operation involving the police and air force personnel is underway to free the trapped passengers.
The bus, en route to Deniyaya from Pettah, was struck by the falling tree near Liberty Junction in Kollupitiya.
Injured passengers have been swiftly transported to the hospital for immediate medical care. Consequently, Duplication Road has been temporarily closed for traffic, and motorists have been advised to seek alternative routes.
The Central Bank expects a significant reduction in market lending interest rates as part of monetary easing measures, while potential inflation concerns may arise due to Budget 2024 and global petroleum price increases. Central Bank Governor addresses key points, including inflation trends, decreasing policy interest rates, state bank restructuring, the status of the Employees’ Provident Fund management, and disputed growth projections compared to the World Bank and IMF during the briefing.
Fitch Ratings affirms its ratings on fifteen (15) Sri Lankan banks, while 14 of them have been removed from ‘Rating Watch Negative’ (RWN) and assigned stable outlooks. Affirms that Bank of Ceylon’s (BOC) Long-Term Local-Currency Issue Default Rating (IDR) at ‘CCC-‘ and removed it from RWN while adding that the Outlook is Stable.
Saliya Wickramasuriya has been appointed as the Chairman of the Ceylon Petroleum Corporation (CPC) and the Ceylon Petroleum Storage Terminals Ltd (CPSTL). The Managing Director of the CPC, Darshana Rathnayake has been appointed as the Managing Director of the CPSTL.
The President of the All Island Canteen and Restaurant Owners’ Association, announces that the prices of three food items have been increased in line with the recent gas price hike: Plain tea has been increased by Rs. 10, Koththu Rotti by Rs. 20, and Rice packets by Rs. 50.
Sri Lanka’s official reserves stand at approximately US $3.5 billion, including a US $1.4 billion agreement with China’s People’s Bank subject to certain conditions as of September’ 23 During the first eight months of 2023, Sri Lanka’s reduced spending on imports contributed to a smaller trade deficit, and despite some declines in merchandise exports, the impact was not as significant as the import reductions.
The Socialist Youth Union (SYU) files a petition in the Supreme Court seeking an order declaring that the Online Safety Bill tabled in the parliament by the government is in violation of the constitution. Alleges that the relevant bill is in violation of the fundamental rights of freedom of speech and expression guaranteed by the Constitution.
The G.C.E. Advanced Level Examination will be held from January 04, 2024 to January 31, 2024, announced the Commissioner General of Exams.
The Supreme Court, with a bench of Justices Murdu Fernando, Yasantha Kodagoda, Shiran Gunaratne, Achala Wengappuli, and Priyantha Fernando, instructed the Attorney General to provide a report on the compensation granted to the families of fishermen impacted by the MV X-Press Pearl disaster.
Minister of Agriculture Mahinda Amaraweera informs that there is significant international demand for Sri Lankan toque macaque monkeys, with numerous foreign nations expressing interest in obtaining them for their zoos, following a high-profile request from a Chinese firm that led to a court case.
England makes ODI history in World Cup opener with unusual record. All 11 England batters reached double figures in England’s total of 282/9, meaning that Jos Buttler’s team became the first ever to do so in the history of the international format across both the men’s and women’s games.
Mullaitivu District Judge R. Saravanaraja has announced that he is forced to resign due to life threat and continuous pressure from the Government of Sri Lanka. The judge, who has been the target of continuous threats ever since he issued the order in the Mullaitivu Kurundurmalai, and Kokkuthoduvai mass graves cases. He has announced his resignation through a letter dated 2023-09-23 and has as fled the island fearing for his life.
In addition, judges often have restrictions on their political activities, public statements, and financial interests to maintain their impartiality and the appearance of impartiality. These restrictions may vary by jurisdiction and level of the judiciary. Saravanarajah is a very neutral and honest person.
Politicians should not influence the legal system, but in Sri Lanka Tamil judges experience a lot of pressure from Buddhist monks and Sinhalese politicians. Sinhala politician and former military chief Sarath Veerasekara castigated Judge Saravanarajah as a crazy person for his judicial rulings.
Judges are entitled to protection from harassment, threats, or violence, and appropriate measures should be taken to ensure their safety and security. The Sinhalese government and Sinhalese nationalists have never accepted the rulings of the Tamil judges in Sri Lanka. This reflects the reality that there are two separate rules of law in Sri Lanka, and actions by Sinhala Buddhist monks and thugs against Tamils are above the law.
Justice Saravanaraja has announced his resignation in a court letter addressed to the Secretary of the Judicial Service Commission, stating that he is resigning due to threats to his life and constant pressure.
International norms guarantee the independence of the judiciary, ensuring the safety of judges against threats, pressure, or political interference in their work. Governments have an obligation to protect the independence of the judiciary and ensure the safety of judges. The rule of law and the integrity of the judicial system depend on the ability of judges to make decisions based on the law and evidence, free from external influence and intimidation.
Judge Saravanarajah’s plight is emblematic of a failed State, with the independence of the judiciary in shambles. It further proves that Tamils cannot get equal justice in Sri Lanka. Those who are trying to prop up the failed state through billions in economic aid should take serious note of the ground reality.
International Council of Eelam Tamils (ICET) strongly condemns the threat to life of Judge Saravanarajah and urges the countries bailing out Sri Lanka to take serious note.
Colombo (LNW): Attorneys today (05) staged a protest outside the Aluth Kade Magistrate Court demanding an end to repressive laws.
Under the slogan “Withdraw Anti Terrorism Bill – Hands Off Democracy” the lawyers demanded the withdrawal of the Anti-Terrorism Bill and the Online Safety Bill and called for justice for the Mullaitivu Judge, who had resigned due to what he described as ‘death threats’.
The protesters urged that the democratic rights of the citizens of Sri Lanka be safeguarded.
Colombo (LNW): The Supreme Court today (05) directed the Attorney General to produce a report on the compensation given to the fishermen’s families affected by the MV X-Press Pearl disaster.
This was when the case was heard by the Supreme Court Bench comprised of Justices Murdu Fernando, Yasantha Kodagoda, Shiran Gunaratne, Achala Wengappuli, and Priyantha Fernando.
Justice Murdu Fernando inquired from Additional Solicitor General Nerin Pulle about the compensation amounts distributed to the affected fishermen, and in response, Pulle replied that he could not provide a specific answer without further investigation.
Consequently, the Supreme Court instructed the AG to provide a detailed report on the compensation distributed to the affected fishermen due to the maritime disaster.
