Biggest international syndicated loan for BoC

The Bank of Ceylon, and HSBC, successfully completed a US$210 million three-year syndicated loan facility for the Bank of Ceylon (BoC).

The agreement was signed at a ceremony at The Oriental Hotel, in Singapore recently. It establishes a new frontier for the offshore syndicated loan market for Sri Lanka, being the largest international syndicated loan facility for a Sri Lankan entity.

The success of this loan syndication epitomises the resourcefulness of the global giant HSBC in being able to draw on their international expertise and reach to attract international investors to Sri Lanka at very competitive pricing.

Roadshows were held in four countries including Hongkong, Singapore, Bahrain and the UAE. The credit strength of Bank of Ceylon and distribution power of HSBC ensured an overwhelming response to the syndication.

Strong demand for the loan allowed for an increase in the size from the original US$100 million to US$210 million, and pricing with a margin of 0.50 per cent over three-month US$ Libor (London Interbank Offered Rate). A syndicate of 21 banks was built, with demand well distributed between financial institutions in Asia, the Middle East and Europe.

"The massive 110% over-subscription from 21 banks in Asia, Middle East and Europe within six weeks, the very low rate of 0.5% over the three-month US$ Libor, and the three-year repayment period provide a clear indication of the high level of confidence that the international investor community has in Sri Lanka as well its leading state bank in the longer term, in spite of frequent negative press reports in the international media," said General Manager of Bank of Ceylon B. A. C. Fernando, who led the Bank's team that raised this loan.

It is a further testament to the growing reputation and increasing internationalisation of the borrower, Bank of Ceylon, and the country as a whole, in the eyes of the global investor community.

The Bank of Ceylon continues to outperform the industry, turning in financial results that have reinforced its position as the No. 1 Bank in Sri Lanka.

The Bank has recorded many milestones in the Sri Lankan Banking Industry, which include the highest rated Sri Lankan bank in the Bankers Almanac, first commercial bank having assets in excess of Rs. 400 Bn (USD 3.6 Bn), largest capital base of Rs. 18 Bn, highest single borrower exposure of up to Rs. 7.3 Bn and largest online network with over 500 service points.