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Join date : 2014-02-22
High investor demand for SL Development Bonds
Tue Jun 24, 2014 7:35 am
*$ 50 m three year issue oversubscribed by near 5 times with $ 239.5 m bids received
Investor demand for the latest issuance of Sri Lanka Development Bonds (SLDBS) has been high, judging by near five times oversubscription.
The Central Bank said yesterday the June 2014 issuance of $ 50 million three-year SLDBs at a rate of SU Dollar 6 month LIBOR plus a margin drew bids amounting to $ 239.5 million reflecting a 4.8 times oversubscription.
“Considering the high demand at a highly competitive margin for SLDBs and providing an opportunity for investors to invest their funds for a longer period, it was decided to accept the entirety of $ 239.5 million,” the Central Bank said.
The market determined rate was USD 6 month LIBOR plus a weighted average margin of 375 bps. The US Dollar 6 month LIBOR rate as of 23 June, 2014 was quoted at 0.3234%.
Foreign and local commercial banks operating in Sri Lanka subscribed at the auction.
The offer was opened from 16 to 23 June with the settlement on 30 June, 2014.
The last issue in March amounting to $ 60 million was oversubscribed by three times with bids worth $ 187 million received and entirety accepted at USD six month LIBOR plus a weighted average margin of 400 bps. The US Dollar six month LIBOR rate then was 0.3318%.
The SLDBs are transferable by endorsement, delivery and registration with the Superintendent of Public Debt of the Central Bank of Sri Lanka. Eligible investors may purchase SLDBs in the secondary market through Designated Agents appointed by the Central Bank of Sri Lanka.
CB says financial system sound
*Releases Financial System Stability Review 2013
The Central Bank has just published the 2013 edition of the Financial System Stability Review (FSSR) presenting information on financial system stability.
The annual FSSR covers developments in the financial sector; policy measures that have been taken to mitigate potential risks to financial system stability; and possible implications of emerging trends in the domestic economy as well as the global economy.
In addition, the FSSR covers several topical issues which merit in-depth study.
As highlighted in the FSSR 2013, Sri Lanka’s financial system remains sound, and continues to support the expansion of domestic economic activity. The banking and finance company sectors have maintained their soundness at healthy levels. The insurance sector also maintained its solvency and liquidity at healthy levels.
Financial markets, meanwhile, have remained liquid. Going forward, the continued moderation of interest rates following the easing of monetary policy in 2013 as well as in early 2014 is expected to stimulate credit growth. The recovery in global economic activity would provide further stimulus to domestic economic activity, which is expected to pick up in 2014.
In response to the policy initiatives of the Government to develop the domestic capital market, activity in relation to debentures increased in 2013. The development of the corporate bond market will add to the strength of the domestic economy.
With respect to payment and settlement systems in the country, the Common ATM Switch (CAS), which is the first phase of the Common Card and Payment Switch (CCAPS), started live operations in July 2013. While the CCAPS will provide a nation-wide common platform for electronic retail payment systems, the CAS will enable the utilisation of the ATM network in the country more efficiently and effectively, thereby reducing the costs incurred by financial institutions in providing ATM facilities.
Payment and settlement infrastructure in the country is expected to advance further towards an environment of digitalized transactions where electronic payment systems such as e-money, e-payments and mobile payments systems are made available to carry out a wider range of retail transactions. Meanwhile, consolidation in the financial sector would result in the emergence of stronger and more efficient financial institutions that are able to offer a wider array of financial services.
The Central Bank will continue to strengthen regulation of the financial institutions as well as the payment and settlement systems it overlooks. Strong regulation coupled with supervision focused on identifying potential risks and vulnerabilities will help enhance the ability of the domestic financial system to withstand potential shocks and ensure the continued provision of financial services such as lending, insurance and execution of payments, even in stress situations and during periods of structural adjustment.
The FSSR 2013 is on the Central Bank of Sri Lanka website: www.cbsl.gov.lk.
http://www.ft.lk/2014/06/24/high-investor-demand-for-sl-development-bonds/
Investor demand for the latest issuance of Sri Lanka Development Bonds (SLDBS) has been high, judging by near five times oversubscription.
The Central Bank said yesterday the June 2014 issuance of $ 50 million three-year SLDBs at a rate of SU Dollar 6 month LIBOR plus a margin drew bids amounting to $ 239.5 million reflecting a 4.8 times oversubscription.
“Considering the high demand at a highly competitive margin for SLDBs and providing an opportunity for investors to invest their funds for a longer period, it was decided to accept the entirety of $ 239.5 million,” the Central Bank said.
The market determined rate was USD 6 month LIBOR plus a weighted average margin of 375 bps. The US Dollar 6 month LIBOR rate as of 23 June, 2014 was quoted at 0.3234%.
Foreign and local commercial banks operating in Sri Lanka subscribed at the auction.
The offer was opened from 16 to 23 June with the settlement on 30 June, 2014.
The last issue in March amounting to $ 60 million was oversubscribed by three times with bids worth $ 187 million received and entirety accepted at USD six month LIBOR plus a weighted average margin of 400 bps. The US Dollar six month LIBOR rate then was 0.3318%.
The SLDBs are transferable by endorsement, delivery and registration with the Superintendent of Public Debt of the Central Bank of Sri Lanka. Eligible investors may purchase SLDBs in the secondary market through Designated Agents appointed by the Central Bank of Sri Lanka.
CB says financial system sound
*Releases Financial System Stability Review 2013
The Central Bank has just published the 2013 edition of the Financial System Stability Review (FSSR) presenting information on financial system stability.
The annual FSSR covers developments in the financial sector; policy measures that have been taken to mitigate potential risks to financial system stability; and possible implications of emerging trends in the domestic economy as well as the global economy.
In addition, the FSSR covers several topical issues which merit in-depth study.
As highlighted in the FSSR 2013, Sri Lanka’s financial system remains sound, and continues to support the expansion of domestic economic activity. The banking and finance company sectors have maintained their soundness at healthy levels. The insurance sector also maintained its solvency and liquidity at healthy levels.
Financial markets, meanwhile, have remained liquid. Going forward, the continued moderation of interest rates following the easing of monetary policy in 2013 as well as in early 2014 is expected to stimulate credit growth. The recovery in global economic activity would provide further stimulus to domestic economic activity, which is expected to pick up in 2014.
In response to the policy initiatives of the Government to develop the domestic capital market, activity in relation to debentures increased in 2013. The development of the corporate bond market will add to the strength of the domestic economy.
With respect to payment and settlement systems in the country, the Common ATM Switch (CAS), which is the first phase of the Common Card and Payment Switch (CCAPS), started live operations in July 2013. While the CCAPS will provide a nation-wide common platform for electronic retail payment systems, the CAS will enable the utilisation of the ATM network in the country more efficiently and effectively, thereby reducing the costs incurred by financial institutions in providing ATM facilities.
Payment and settlement infrastructure in the country is expected to advance further towards an environment of digitalized transactions where electronic payment systems such as e-money, e-payments and mobile payments systems are made available to carry out a wider range of retail transactions. Meanwhile, consolidation in the financial sector would result in the emergence of stronger and more efficient financial institutions that are able to offer a wider array of financial services.
The Central Bank will continue to strengthen regulation of the financial institutions as well as the payment and settlement systems it overlooks. Strong regulation coupled with supervision focused on identifying potential risks and vulnerabilities will help enhance the ability of the domestic financial system to withstand potential shocks and ensure the continued provision of financial services such as lending, insurance and execution of payments, even in stress situations and during periods of structural adjustment.
The FSSR 2013 is on the Central Bank of Sri Lanka website: www.cbsl.gov.lk.
http://www.ft.lk/2014/06/24/high-investor-demand-for-sl-development-bonds/
sereneTop contributor
- Posts : 4850
Join date : 2014-02-26
Re: High investor demand for SL Development Bonds
Tue Jun 24, 2014 10:17 am
Hope that the opprtunity will be utilised to maximum effect.
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