NSB records again its dominance in raising funds in the Debt Capital Market

National Savings Bank (NSB), the premier most savings bank in the country furthering its dominance, successfully issued yet another debt capital bond to raise Rs.5 Bn.

This time it was a perpetual capital bond issued to augment the additional Tier 1 capital base of the Bank. It carried the customary features required for a bond of this nature; unlisted, unsecured, rated, subordinated and perpetual in maturity. Further, in compliance with Basel III requirements carried non-viability write down features as approved by the Central Bank of Sri Lanka.

This is the first time in the history of a savings bank, that a hybrid debt instrument of this nature and in this magnitude was issued, in the Sri Lankan Capital Market. In compliance with the statutory requirements of the Bank, the bond was not listed and was confined to qualified investors. The Bank is at the liberty of exercising a call option at its will only after the expiry of a minimum period of 5 years.

The successful closure of the issue, despite not having a specific date of maturity for the investment is a testament to the confidence, the investors have placed with the Bank.

The investors had an option of opting to earn an interest income at a fixed rate or a floating rate which was priced at very attractive terms for this type of a hybrid instrument. The main objective of the issue was to strengthen the additional Tier 1 capital base of the Bank.

NSB carries the highest credit rating, a bank can have in the country. This issue is just an extension of a series of issues made in the past, namely the largest international sovereign bond issue of USD One Billion, unlisted debenture issue of Rs.20 Bn. and further issuance of Rs.6 Bn. from 2013 – 2019. All these issues were structured and managed by the Corporate Finance Division of the Bank.

NSB being a pioneer financier of Sri Lanka’s infrastructure projects, would utilize the proceeds of the issue to fund long term funding requirement of the economy as well as to address the needs of the retail borrowers. The Bank’s customer base consists of retail customers of all strata, premier corporates and government entities. The Bank’s portfolio of lending also includes overseas ventures. The Bank humbly takes pride of being a partner of the major development projects in the country.

NSB will be celebrating its 50 years of presence in the banking fraternity of the country in a few months’ time with a mark of unparalleled track record of being a driving force in the country’s economic development and improving the living standards of the Sri Lankan people.

NSB with this solid history is poised to further its horizons in the coming years.