GoSL goes for second Foreign Currency Term Financing Facility (FCTTF) - Opportunity Sri Lanka
GoSL goes for second Foreign Currency Term Financing Facility (FCTTF)

GoSL goes for second Foreign Currency Term Financing Facility (FCTTF)

The Government of Sri Lanka (GoSL) in Cabinet Memorandum dated August 16, 2017 has decided to upsize the Foreign Currency Term Financing Facility (FCTTF)through a syndication up to USD 1,000 million, granting the original lenders “… the ability to assign or transfer their rights under the facility agreement and new lenders will also join into the syndication agreement.”
The original lenders, Bank of Baroda, Singapore Branch; Qatar National Bank, Singapore Branch; State Bank of India, Hong Kong Branch; Deutsche Bank AG, Singapore Branch; Indian Bank, Colombo Branch and Sumitomo Mitsui Banking Corporation, Singapore Branch had collectively provided a maximum FCTTF of USD 450 million.
On August 8, 2017 the Secretary to the Treasury had signed the Syndication Agreement for the upsized amount of USD 550 million.
The Memorandum further states that the Steering Committee “… also approved that the upfront fee, the legal costs and the Roadshow/Syndication expenses be deducted from the final proceeds to be remitted to the consolidated fund in respect of both the tranches i.e. USD 450 million and the syndicated amount of USD 550 million as appropriate.”
An excerpt of the Memorandum reads as follows;

    i. A breakdown of such costs for both tranches includes the following:

      1. Initial Upfront fee USD 6,750,000.00
      2. Agency Fee USD 30,000.00
      3. Additional Upfront fee USD 8,250,000.00
      4. Legal. fee USD 48,500.00
      5. Roadshow costs USD 53,015.28

    ii. Hence from the tranche of USD 550,000,000.00 after the deduction of only USD 8,351,515.28 the consolidated fund will receive USD
    USD 541,648,484.72, while from the tranche of USD 450,000,000.00 after the deduction of USD 6,780,000.00, the consolidated fund
    received USD 443,220,000.00
    iii. Therefore, in total with the deduction of upfront fees, Agency fee, Legal fees and Roadshow expenses the Government of Sri Lanka
    will receive USD 984,868,48412, on net basis.

The funds will likely once again be used to meet the country’s expenses and be utilised on development projects.


As previously stated by the GoSL, the FCTTF will “…enable low cost financing and will allow access to different investor communities who wish to invest in Sri Lanka.”
The access to finance will be an attractive prospect to interested investors.

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Article Code : VBS/AT/07092017/Z_8

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