Tuesday Sep 29, 2026
Tuesday Sep 29, 2026
Tuesday, 29 September 2026 03:11 - - {{hitsCtrl.values.hits}}
Separate debenture issue opens 1 Oct. to raise up to Rs. 5 b
Pan Asia Banking Corporation PLC plans to raise up to Rs. 4 billion through a five-year Basel III-compliant Tier 2 debenture issue.
The bank yesterday said its Board resolved to issue up to 40 million listed, rated, unsecured, subordinated, redeemable debentures at a par value of Rs. 100 each. The issue is subject to regulatory approvals, and the bank proposes to list the debentures on the CSE. The interest rate has not been disclosed.
Tier 2 debentures count towards a bank’s regulatory capital. As subordinated debt, they rank behind depositors and senior creditors for repayment if a bank is wound up. The non-viability conversion feature allows the debentures to be converted into shares or written off if the regulator judges the bank no longer viable, so that bondholders absorb losses before taxpayers.
The Tier 2 plan comes as the bank prepares to open a separate senior debenture issue on 1 October, 2026, to raise up to Rs. 5 billion. The senior issue comprises an initial 20 million listed, rated, senior, unsecured, redeemable debentures at Rs. 100 each, with options to issue a further 20 million and then 10 million in the event of oversubscription, to raise up to Rs. 5 billion. Type A debentures carry a fixed rate of 12.75% a year over three years, and Type B a fixed 13.50% over five years, both paid annually. Commercial Bank of Ceylon PLC is the manager to the issue.
Together, the two issues could raise up to Rs. 9 billion.
