ComBank receives USD 50 m equity from IFC | Sunday Observer

ComBank receives USD 50 m equity from IFC

11 October, 2020

The Commercial Bank of Ceylon has completed all formalities relating to the private placement of shares with the International Finance Corporation (IFC) and the receipt of US$ 50 million (Rs. 9.215 billion) for 115,197,186 ordinary voting shares in the Bank.

This is the first post-pandemic equity placement by the IFC and is one of the largest foreign investments into Sri Lanka since the start of the Covid-19 pandemic, a Bank officialsaid. The investment collectively makes the IFC, the IFC Financial Institutions Growth Fund LP (FIG Fund) and the IFC Emerging Asia Fund LP (EA Fund) the largest shareholder of the Commercial Bank of Ceylon and strengthens the Bank’s shareholder composition by increasing its foreign shareholding up to 30%.

The completed share allotment filing by Commercial Bank to the Colombo Stock Exchange (CSE) yesterday indicates the IFC received 34,559,156 shares and the IFC FIG Fund and the IFC EA Fund receiving40,319,015 each.

The Bank’s Managing Director S. Renganathan said, “This investment represents many benefits to the Bank as well as to the country, especially at a time like the present, when economies and markets are reeling from the impact of the Covid-19 pandemic. We are delighted to have the IFC, the IFC FIG Fund and the IFC EA Fund as key institutional investors in the Bank, as it will further strengthen investor confidence while raising funds to support the Bank’s future growth.”

The IFC equity placement was done at a premium price of Rs. 80 per share, 20% more than the Weighted Average Price of Rs 66.78 for the 30 days preceding June 29, 2020, the date of the Board resolution on the private placement.

The shares allotted to the IFC, IFC FIG Fund and the IFC EA Fund via this private placement rank pari-passu in all respects with the existing ordinary voting shares of Commercial Bank and enjoy the same voting rights, rights to dividends and an equal share in the distribution of surplus assets on liquidation.