Bank of Ceylon (BOC) is set to create another milestone in the country’s capital market with the launch of Sri Lanka’s largest-ever listed debenture issue, with a maximum issue size of LKR 30 billion.
The Bank proposes to initially raise LKR 10 billion, with an option to increase the issue to LKR 20 billion in the event of an oversubscription of the initial tranche and a further option to increase the total issue size up to LKR 30 billion, making it the largest listed debenture issue undertaken in Sri Lanka.
The proposed issue comprises Basel III compliant, Tier 2, Listed, Rated, Unsecured, Subordinated, Redeemable debentures with a non-viability write-down feature. The debentures carry an issue rating of AA (Stable) from Lanka Rating Agency, while BOC’s issuer rating stands at AA-(lka)/Stable from Fitch Ratings Lanka Ltd. The debentures will be offered with five-year and seven-year maturities, providing with medium to long-term fixed income investment opportunities. The issue is confined to qualified investors and the minimum subscription for qualified investors is LKR 10,000, while individual investors are required to apply for at least LKR 5 million.
The debentures are offered in four different types to meet diverse requirements of qualified investors. The Fixed coupon rate of the five-year debenture will be 12.75 percent per annum while the floating coupon rate will be 1.50 percent above the applicable twelve-month Treasury Bill rate. The Fixed coupon rate of the seven-year debenture will be 13.00 percent per annum while the floating coupon rate will be 1.75 percent above the applicable twelve-month Treasury Bill rate.
BOC is a Corporate Finance Advisor licensed by the Securities and Exchange Commission of Sri Lanka. This largest Basel III Debenture issuance was exclusively structured and managed by the Investment Banking team who possess a wealth of expertise in structuring innovative capital market instruments. The issue follows BOC’s pioneering Sustainability Bond issuance, another landmark transaction structured and managed by the Bank’s Investment Banking Division, reflecting BOC’s continued leadership in developing innovative capital-market solutions while advancing sustainable finance in Sri Lanka.
The Legal Department of BOC acts as the lawyers to the issue, while the Corporate Branch of the Bank acts as the bankers to the issue. The Investment Banking Division will also continue to act as the Registrar to the proposed issue, while Hatton National Bank PLC will be the trustee to the issue.
The Bank is opening the subscription list of the BASEL III Debenture Issue at 9.30 a.m. on 3 rd November 2026 and will remain open for 14 market days unless the Bank decides to close it earlier based on subscription levels. Applications for the debentures will be accepted from qualified investors in accordance with the terms and conditions set out in the Prospectus. The Prospectus and application forms can be downloaded from the web sites of the CSE; www.cse.lk and BOC; www.boc.lk.
Source : Daily News