Sampath Bank’s Rs. 10 b debenture issue snapped up

Thursday, 2 February 2023 02:04 - - {{hitsCtrl.values.hits}}

The Sampath Bank PLC’s Rs. 10 billion debenture has been oversubscribed following which it was closed on Tuesday.

It issued an initial 50 million Basel III Compliant-Tier 2, Listed, Rated, Unsecured, Subordinated, Redeemable 5 year Debentures (2023128) with a Non-Viability Conversion of the par value of Rs. 100 each to raise Rs. 5 billion with an option to issue up to a further 20 million debentures (worth Rs. 2 billion) at the discretion of the bank in the event of an oversubscription of the initial issue and with a further option to issue up to a further 30 million debentures (Rs. 3 billion) at the discretion of the bank in the event of an oversubscription of the initial issue and the second tranche.

Sampath Bank said it received applications for over Rs. 10 billion and accordingly the issue has been oversubscribed.

The debenture issue consisted of two types. Type A was five year tenure with 28% fixed interest rate per annum and Type B was five year tenor with floating rate – one year Treasury Bill rate plus 1.5% subject to a floor of 20% and a cap of 31%, payable annually. The debentures were rated ‘BBB+’/RWN by Fitch.

The placement agent of the debenture issue was acuity partners.

Sampath Bank intends to utilise the funds raised through the debenture issue to strengthen the capital position of the bank and improve the liquid assets of the bank.