Wednesday Feb 25, 2026
Wednesday Feb 25, 2026
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LB Finance Executive Director Ravindra Yatwara (left) receives the latest rating certificate from Lanka Rating Agency CEO Dr. Kenneth De Zilwa
LB Finance PLC, has been awarded an ‘A+’ credit rating with a Stable outlook by Lanka Rating Agency (LRA), underscoring the company’s strong credit fundamentals, superior asset quality, and robust capital position.
The rating places LB Finance among the top-tier non-banking financial institutions in the country, a statement from the Company said.
The ‘A+’ rating is based on the company’s financial performance and position as at end-September 2025, reflecting its solid market standing, resilient profitability, and disciplined risk management framework. As at September 2025, LB Finance accounted for 12.3% of total sector assets and 12.4% of sector deposits, highlighting its scale and systemic relevance within the licensed finance company sector.
For the six months ended September 2025, LB Finance recorded a Profit After Tax of Rs. 5.8 billion, representing a 23.7% year-on-year increase. Net Interest Income for the six-month period amounted to Rs. 14.2 billion, supported by timely repricing of assets and effective balance sheet management. The Company delivered a full-year FY25 Profit After Tax of Rs. 10.8 billion, with Return on Equity of 22.8% in FY25 and 21.9% for the first half of FY26, demonstrating sustained earnings strength.
A key driver underpinning the rating is LB Finance’s exceptional asset quality, which remains significantly stronger than industry peers.
As at September 2025, the company reported a Gross Non-Performing Loan ratio of 1.55% and a Net NPL ratio of -1.36%, supported by a provision coverage ratio of 187.7%, reflecting conservative provisioning practices and prudent credit risk management.
The company’s capital strength as at September 2025 was also a major rating positive. LB Finance reported a Total Capital Adequacy Ratio of 23.66% and a Tier 1 Capital Ratio of 22.74%, comfortably exceeding the regulatory minimum requirements of 14% and 10%, respectively.
Lanka Rating Agency CEO Dr. Kenneth De Zilwa said: “The ‘A+’ rating is anchored on LB Finance PLC’s superior asset quality metrics, strong capitalisation profile, and demonstrated ability to generate stable earnings across operating cycles. The company’s provisioning buffers, liquidity management, and disciplined credit underwriting provide a high degree of balance sheet protection, which is critical in the current macroeconomic environment. Our assessment recognises LB Finance PLC as a structurally resilient institution with the governance depth and financial flexibility required to sustain growth without compromising credit fundamentals.”
Subsequent to the September 2025 rating reference period, LB Finance sustained its strong performance through the nine months ended 31 December 2025. The Group recorded a Profit after Tax of Rs. 9 billion, reflecting a 26% year-on-year growth, supported by its established market leadership, experienced management team, sound governance framework, and continued focus on sustainable growth.
