SLDB performance improves

Since the end of the war last May, there has been a marked increase in investor sentiments and interest in Sri Lanka’s Development Bond and Sovereign Bond issues.

In March 2009, Sri Lanka Development Bonds (SLDB) for US$ 200 million attracted only US$ 184 million.

However, the first issue after the war in June 2009, an SLDB issue had been oversubscribed by 135 percent, raising US$ 115.8 million of which US$ 50 million was to be rolled over while the balance went in to replenish reserves of the Central Bank after a US$ 125 million loan repayment was made. The offered SLDBs in this issue amounted to US$ 50 million with a two year maturity period at the 6 month LIBOR for US Dollars plus 4.97 per cent.

In August 2009, the Public Debt Department of the Central Bank issued US$ 190 million Sri Lanka Development Bonds (SLDB) at a rate of LIBOR 6 month rate for US dollars plus 449.8 basis points (4.49 percent) to pay-up maturing bonds amounting to US$ 175 million. This offer was for two year SLDBs for US$ 150 million made on August 6 which was oversubscribed 1.3 times with bids from local and foreign commercial banks amounting to US$ 195.5 billion. The bank accepted US$ 190 million of these bids.

In March 2010, the government accepted US$ 92 million after a US$ 100 million Sri Lanka Development Bond issue was 1.34 times oversubscribed with total bids from local and foreign commercial banks amounting to US$ 134 million. The government accepted US$ 55 million on development bonds with a three year maturity period at about 4.35 percent. US$ 37 million development bonds with a two year maturity period were accepted at about 4.20 percent.

source - www.island.lk