Sri Lanka’s People’s Leasing’s biggest NBFI debenture issue of Rs. 10 billion oversubscribed
Sri Lanka’s People’s Leasing & Finance PLC (People’s Leasing) has reportedly announced the successful oversubscription of Rs. 10 billion senior, unsecured, listed, redeemable, rated, three-year and five-year debentures at a par value of Rs. 100 with the receipt of applications for over Rs. 14 billion by the closure.
People’s Leasing & Finance had issued Rs. 4 billion senior, unsecured, listed, redeemable, rated, debentures with an option to offer a further Rs. 6 billion debentures in the event of oversubscription aggregating to a value of up to Rs. 10 billion, according to local media reports.
The original decision to issue Rs. 8 billion was upsized to Rs. 10 billion upon receiving necessary regulatory approvals. The issue was rated A+(lka) by Fitch Ratings Lanka Ltd.
The issue has reportedly offered investors four opportunities in the form of Type A, B, C and D.
Type A and Type C has offered fixed coupon rates payable annually for three and five year tenors, whilst Type B and Type D are zero coupon debentures for three and five year tenors. All four types of debentures offer rates ranging from 8.00% per annum (AER 8.00%) to 9.00% per annum (AER 9.00%) for three years and five years respectively, the Daily FT has reported.
People’s Bank Investment Banking Unit and Capital Alliance Partners Ltd. acted as the joint managers to the issue.
People’s Leasing Chief Executive Officer/GM Shamindra Marcelline commenting on the successful oversubscription has been quoted as saying, “This landmark transaction is the largest-ever debenture offering by a NBFI and clearly marks another significant achievement by People’s Leasing & Finance PLC, as it reiterates the confidence placed by the investor community in the company’s strong credit story.”
OSL take:
The oversubscription of Sri Lanka’s state owned People’s Bank is indicative of the strength and growth of the country’s banking sector. It is a further indication of the business conducive environment in the country. Sri Lanka is also becoming a business hub in the South Asian region given it’s geographical positioning in the Indian ocean and the many trade agreements as well as trade concessions enjoyed by the country. Despite the challenges posed by the global Covid 19 pandemic, Sri Lanka has shown a growth momentum in several key economic sectors in the country and has launched an aggressive development programme. Sri Lanka is also fast becoming a business hub in the South Asian region given it’s geographical positioning in the Indian ocean and the many trade agreements as well as trade concessions enjoyed by the country. Given Sri Lanka’s economic performance and strong banking sector, foreign businesses/investors could confidently explore opportunities in the country.
| Article Code : | VBS/AT/04082021/Z_3 |