Commercial Bank of Ceylon PLC is of the view that the decision by Fitch Ratings to revise its outlook from stable to negative is not justified.

In a stock exchange filing today (23), the bank noted that Fitch Ratings Lanka Limited has affirmed the National Long Term Rating of the Bank at AA (lka) whilst revising its outlook from stable to negative citing a negative outlook revision of the Sri Lankan sovereign and the consequential deterioration of the operating environment and related risks.

The Bank is of the opinion that the revision in its rating outlook is not justified since the Bank has sufficient safeguards in terms of its business model and sufficient capital buffers are in place to deal with any general deterioration in its operating environment of the nature described in the Rating Report which is evidenced by the Bank's consistent and robust performance in the past.

Fitch Ratings yesterday revised the outlook on several Sri Lanka-based banks including  Commercial Bank of Ceylon PLC  after a similar move on the Sri Lankan sovereign.

Bank's outlook was cut due to the sovereign credit profile which could limit the bank’s ratings in a deteriorating operating environment, the rating agency said.

However, Bank has stable earnings, a strong domestic franchise as the third-largest bank and large deposits to back its liquidity profile, Fitch said.