Former Central Bank Senior Deputy Governor and Daily FT columnist W.A. Wijewardena tweeted last week that the Government has come up with a unique way to manage its upcoming liability of $ 1 billion International Sovereign Bond (ISB).

Wijewardena said that he was told by a London-based trader that they would hold the July ISB to maturity since Sri Lanka would pay foreigners out of reserves and arrange to issue a dollar denominated note to local banks holding these ISBs. 

“No default of these bonds this year,” Wijewardena added.

His apparent comment comes amidst fears within some financial circles locally and international that Sri Lanka may default its upcoming ISB settlement despite Sri Lanka’s clean track record foreign debt servicing and reassurance of same by the Government and the Central Bank.

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