Sri Lanka’s $1.5 bln Dual-Tranche International Sovereign Bond Issuance draws huge interest

The Central Bank of Sri Lanka (CB) “marked its return to the U. S. dollar bond markets” with a successful issuance of US$500 million 5.5-year and $ 1 billion 10- year International Sovereign Bonds (Bonds) on July 11, the CB said in a media release on Tuesday.

“This marks Sri Lanka’s 10th US Dollar bond issuance and the first dual tranche offering,” it said.

The bonds have been rated ' B1', ‘ B+’ and ‘ B+' by Moody's Investors Service, Standard and Poor’s and Fitch Ratings, respectively. Citig roup, Deutsche Bank, HSBC and Standard Chartered Bank acted as the Joint Lead Managers and Bookrunners of this successful transaction.

The release said despite the high volatility in the global financial markets following the historic UK referendum in June regarding their membership of the EU, the bonds saw strong interest from a wide range of high quality investors. Orders totaled $2.5 billion for the 5.5-year tranche and $3 billion for the 10-year tranche. Both the 5.5- year and 10- year tranche were priced well inside the initial price guidance of 6.125 per cent area and 7.125 per cent area.

“This is a testament to investors' continued confidence in Sri Lanka and their positive sentiment on the economic outlook of Sri Lanka. Driven by high quality institutional accounts globally, both the 5.5year and 10- year tranche attracted orders from over 200 accounts each.”