The National Savings Bank (NSB) has cut its planned bond issue to US $ 500 million from $1 billion and also reduced the bond’s tenure from 10 years, sources close to NSB said. “The roadshow abroad ahead of raising this bond was slated to kick off this week, but now they need fresh approval by [...]

The Sundaytimes Sri Lanka

NSB $1 bln bond reduced by half, roadshow delayed

View(s):

The National Savings Bank (NSB) has cut its planned bond issue to US $ 500 million from $1 billion and also reduced the bond’s tenure from 10 years, sources close to NSB said.

“The roadshow abroad ahead of raising this bond was slated to kick off this week, but now they need fresh approval by the Controller of Exchange and NSB had to make a fresh application to the Controller of Exchange which they did on Thursday,” a source said, noting that they are awaiting a response from the authority.

The roadshow which has been delayed will see NSB go to Singapore, Hong Kong and the UK and meet with international fund managers. The roadshow was planned for June-July, but the lead managers – Citi, Barclays and HSBC to this bond issue had advised them not proceed with the roadshow as the current interest rates aren’t favourable with the initial $1 billion amount, the source said, adding that the difficult investment climate was another reason for reducing the bond issue.

The NSB has been trying to raise foreign funds for a long time. Last year’s the budget proposed a window for NDB and DFCC to raise long term foreign development finance up to US $ 250 million each to provide long term funding for Small and Medium Enterprises, plantations, construction industry and other manufacturing industries in the country.

The bond issue has been mired in controversy. In June, the NSB Chairman Sunil Sirisena was sacked on the directions of Treasury Secretary P.B. Jayasundera as the former showed a reluctant to speedily agree to the bond owing to a foreign risk element. The money is expected to go into Treasury coffers to meet urgent government spending needs.




Share This Post

DeliciousDiggGoogleStumbleuponRedditTechnoratiYahooBloggerMyspace
comments powered by Disqus

Advertising Rates

Please contact the advertising office on 011 - 2479521 for the advertising rates.