The Colombo Stock Exchange (CSE) has approved in principle the listing of Commercial Bank of Ceylon PLC’s Rs 10 billion Debenture Issue opening on Tuesday, July 2.
The Bank has announced an initial issue of 100 million Basel III Compliant – Tier 2 Listed Rated Unsecured Subordinated Redeemable Debentures with a Non-Viability Conversion feature, at the par value of Rs 100 each, to raise a sum of Rupees 10 Billion, with an option to issue upto a further 50 millionDebentures, at the discretion of the Bankin the event of an oversubscription of the initial issue, and with a further option to issue upto a further 50 million Debentures, at the discretion of the Bankin the event of an oversubscription of the initial issue and the second tranche.
A Bank spokesman said the issue will further strengthen its Tier II capital base, raise funds for the expansion of its lending portfolio, and bridge maturity mismatchesin the assets and liabilities portfolio of the Bank.
Limited to Qualified Investors, the Debentures will be offered in six types with three tenures – Types A and B with a five-year tenure, TypesC and D with a seven-year tenure, and TypesE and F with a 10-year tenure.
Type A will carry a fixed interest rate of 12.60% p.a. (AER 13.00%) payable semi-annually; Type B 13.00% p.a. (AER 13.00%) payable annually; Type C 12.85% p.a. (AER 13.26%) payable semi-annually; Type D 13.25% p.a.(AER 13.25%) payable annually; Type E 13.00% p.a. (AER 13.42%) payable semi-annually; and Type F 13.50% p.a.(AER 13.50%) payable annually. The minimum subscription per application for an individual Qualified Investor is set at Rs 5 million, and the minimum subscription per application for other Qualified Investors at Rs 10,000 or 100 Debentures.
The Debentures are rated BBB+(lka) by Fitch Ratings Lanka Limited. The Investment Banking Division of Commercial Bank of Ceylon PLC is the Manager to the Issue.
