BOC concludes Rs. 3 b fund raising via Tier I Capital Perpetual Bond

Bank of Ceylon (BOC), the largest State-owned licensed commercial bank (LCB) and the market leader in the financial services sector in Sri Lanka, successfully launched a private placement of Basel III Compliant, rated, unlisted, unsecured, subordinated, additional Tier i Capital Perpetual Bond issue with non-viability write down features. 

The amount to be raised was Rs. 3 billion though the issue had an option to raise a further Rs. 5 billion in the event of oversubscription of the initial issue. The bond issue was approved by the Securities and Exchange Commission (SEC) of Sri Lanka and Central Bank of Sri Lanka.

This issue was restricted only to qualified investors as the bonds are not listed in the CSE. The bonds are subject to the call option at the bank’s discretion at any time after the expiry date of five years from the date of issue subject to the Monetary Board’s approval and few other conditions.

The bank opines the long-term funds raised by this bond issue will be utilised for lasting financing and the fulfilment of priority sector of the economy at the same time.

In July 2020, BOC introduced a novel debt instrument to the Sri Lankan debt capital market through the Tier 1 Capital Perpetual Bonds with the issuance of Rs. 5 billion Basel III compliant, unlisted, unsecured, subordinated, additional Tier I Capital Perpetual Bonds with non-viability write down features. 

BOC, in December 2020, raised Rs. 10 billion via a similar Basel III Compliant, rated, unlisted, unsecured, subordinated, additional Tier I Capital Perpetual Bond issue with non-viability write down features.

BOC’s customer base spans across a wide array of public and private sector businesses serviced by the large branch network spread to all corners of the island.  Professional guidance from highly-skilled and proficient bank officials will be readily available to provide solid and sound guidance of efficient utilisation of the funds profitably.

Over eight decades, BOC has an unparallel track record which is decorated with its dynamic and unblemished presence as it turned out as the solid driving force of country’s socio- economic landscape development. 

BOC cherishes the stakeholder confidence gained through the trusted partnership of individuals as well as businesses and the Government by providing access to the finances, whilst safeguarding public interest. 

The confidence and trust the bank has earned over the years among the socio-economic fabric of Sri Lanka extends beyond being a financial intermediary. The fully State-owned bank is rated AA- (lka) by Fitch Ratings Lanka and (SL) AAA by ICRA Lanka.  

Among numerous landmark achievements in the fund raising in domestic as well as foreign markets, BOC has raised Rs. 84.21 billion locally by issuing listed and unlisted debentures and $1 billion through the issue of Listed International Bonds in 2012/13 in overseas markets.   

Investment Banking Division – BOC were the managers and registrar for this bond issue.