SMB follows strong 1H profit with IPO of non-voting shares

Seylan Merchant Bank (SMB), an important niche player in the local merchant banking and leasing sectors, has launched an initial public offering of ordinary non-voting shares following a strong 70 per cent growth in pre-tax profit for the first half of 2006.

The bank is offering 100 million one rupee shares at par, in a move to increase its shareholder base and its issued share capital. The issue will open on August 16 and the prospectus and application forms are now available with the stock brokers and SMB branches, the bank said.

As a special incentive, original subscribers who invest in the IPO will be entitled to a special interest rate of 6 per cent (annualised effective rate) on the leases they take from SMB, up to the value of their investments, the bank said.

IPO subscribers are entitled for this special incentive within two years, even if they have disposed the shares.

The Deputy Chairman of SMB Rohan Senanayake said: "The Rs. 100 million raised from this share issue will be used to improve the capital adequacy of SMB, in line with prudential norms set out by the Central Bank of Sri Lanka."