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Tuesday, June 22, 2010 - 5.30 GMT |
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CB to issue SLDBs |
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The Central Bank of Sri Lanka offered to issue US Dollar 275 million Sri Lanka Development Bonds (SLDBs) to eligible investor categories for subscription at a rate of US Dollar 6 month LIBOR plus a margin to be determined through competitive bidding, Central Bank states.
The offer was opened on 14th June 2010 with the settlement on 30th June 2010. Both foreign and local commercial banks bid at the auction with the total bids received amounting to US Dollar 289.1 million. Of the bids received, the Government decided to accept US Dollar 102.00 million of 3 year bonds and US Dollar 176.00 million of 2 year bonds at the market determined rate of US Dollar 6 month LIBOR + 395 bps (weighted average margin) and 6 month LIBOR + 380 bps (weighted average margin), respectively. Today, the US Dollar 6 month LIBOR rate is 0.75 per cent.
This SLDB issue is in terms of Section 2 (a) and 2 (b) of the Foreign Loans Act No. 29 of 1957 as amended, and the funds mobilized through the new bond issuance are to be used to settle maturing SLDBs of US Dollar 275 million, CB states.
The SLDBs are transferable by endorsement, delivery and registration with the Superintendent of the Public Debt of the Central Bank of Sri Lanka. Eligible investors may purchase SLDBs from Designated Agents appointed by the Central Bank of Sri Lanka in the secondary market, CB further states.
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