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| Sunday, 6 November 2005 |
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Business |  |
| News Business Features Editorial
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People's Merchant Bank raises Rs. 50 m for Ceylease People's Merchant Bank Limited (PMBL) recently structured and placed lease backed trust certificates to the value of Rs. 50 million, on behalf of Ceylease Financial Services Limited (CFSL). The entire issue was taken up by the National Savings Bank (NSB), whilst Deutsche Bank AG acted as the Trustee to the issue. These trust certificates are secure by a quality portfolio of leases and the tenure of these trust certificates ranged from three months to two years. The interest rate attached to the trust certificates was fixed to the one year gross Treasury bill rate. Monies raised through this placement of trust certificates will be utilised to further augment CFSL's fund base and to pursue its aggressive growth strategy. This is the fourth asset backed debt issue placed by PMBL for CFSL, having successfully completed three similar issues to the value of Rs. 100 million, Rs 60 million and Rs150 million previously. CFSL has achieved consistent profit growth during the last few years and they recently obtained a BBB (sri) national long term rating, from Fitch Ratings Lanka Ltd, in respect of its long-term, unsecured senior debt. A 50% subsidiary of Bank of Ceylon, CFSL's other shareholders include the Brandix Group and Union Assurance Ltd. A spokesman for PMBL said that CFSL's credentials, its recent performance and certain credit enhancements embedded in the structure of these debentures, made the risk profile of the trust certificates to be very low. |
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