Lanka to borrow US$400 million

Sri Lanka is planning to borrow US$400 million from the international market by issuing an international bond by October, in a bid to fund infrastructure development projects such as the Weerawila Airport.

“There was a pre-bid conference on July 11 at the Central Bank where the present status of the economy was presented to the bidders which included 16 international banks and two local banks,” an industry source told The Sunday Times FT. He said that JP Morgan, Merrill Lynch, Standard Chartered Bank (Dubai), Deutsche Bank and Royal Bank of Canada, Royal Bank of Scotland UBS and ABN Amro together with People’s Bank and Bank of Ceylon were amongst the bidders.

These institutions are expected to submit proposals by tomorrow and in the next two weeks will be making presentations. “They were asked to propose their own rates and interest payments, whether quarterly or semi-annually priced on the London Interbank Offered Rates (LIBOR,” he said. He added that after the presentations are made, the Treasury will select a lead manager for the issue and by the first week of October the international bond will come into the market.