Sri Lanka’s Central Bank Governor says country looking at 10-year Samurai bond to raise funds
Governor of the Central Bank of Sri Lanka, Indrajith Coomaraswamy has reportedly stated that Sri Lanka is looking at a 10-year Samurai bond to raise funds for debt management, after parliament had approved the raising of around Rs. 480 billion outside the 2019 budget requirements.
“We are going to Tokyo in a couple of weeks to explore the possibility of a Samurai bond,” Governor Coomaraswamy has been quoted as telling the media.
“It would not be wise to borrow less than 10-years (tenure).”
According to the Governor, Sri Lanka was ‘agnostic’ about the type of bond and wanted to borrow at the lowest rate.
He has further noted that a credit guarantee was also available from the Japan Bank for International Corporation for the Samurai bond.
According to local media reports, though yen loans have low rates, Sri Lanka wants to swap the yen to dollars to guard against an appreciating Japanese currency.
OSL take:
Sri Lanka’s economy is on a growth path and the aggressive development programme that is ongoing has resulted in the need for raising funds. Sri Lanka has just completed an oversubscribed sovereign bond issue and is now looking at the option of Samurai bonds. Given the positive developments in Sri Lanka’s key economic sectors, there is no doubt that the country is on the right track. The World Bank recently upgraded Sri Lanka as a upper middle income earning country and the confidence shown by multilateral lending agencies are all indicative of the country’s economic strength. Foreign investors could therefore look at investment opportunities in Sri Lanka.
| Article Code : | VBS/AT/17072019/Z_2 |