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 July 2, 2024.
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 up to a further 50 million Debentures, 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 50 million Debentures, at the discretion of the Bank in the event of an oversubscription of the initial issue and the second tranche.
The Bank said the issue will further strengthen its Tier II capital base, raise funds for the expansion of its lending portfolio, and bridge maturity mismatches in 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 five-year tenure, Types C and D with a seven-year tenure, and Types E and F with a 10-year tenure, the Bank said. 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. For the three months ending March 31, 2024 the Commercial Bank Group reported gross income of Rs 80.208 billion, total operating income of Rs. 34.947 billion and profit after tax of Rs. 10.808 billion and has assets reaching Rs 2.616 trillion.
