Sampath Bank’s Rs. 10 b debenture issue oversubscribed by 22.7%

Monday, 26 October 2026 06:29 - - {{hitsCtrl.values.hits}}

Sampath Bank PLC’s debenture issue was oversubscribed and closed at its maximum of Rs. 10 billion, having drawn applications worth Rs. 12.27 billion, with a small number of large-value payments made through Real Time Gross Settlement (RTGS) transfers and Letters of Guarantee accounting for nearly the entire amount.

According to the Registrars to the issue, Central Depository Systems Ltd., the bank received 31 applications for 122.66 million debentures as at 22 October, against a maximum of 100 million debentures on offer, oversubscribing the issue by 22.7%. Excess demand amounted to Rs. 2.27 billion, or 22.66 million debentures.

The issue comprised up to 100 million Basel III-compliant Tier 2 listed, rated, unsecured, subordinated, redeemable debentures with five-year (2026/2031) and seven-year (2026/2033) tenures, at a par value of Rs. 100 each. It was structured as an initial 70 million debentures to raise Rs. 7 billion, with an option to issue a further 30 million to raise Rs. 3 billion at the bank’s discretion in the event of an oversubscription.

Tier 2 debentures count towards a bank’s regulatory capital. Their non-viability conversion feature allows them to be converted into ordinary shares if the bank is deemed non-viable, meaning holders absorb losses ahead of depositors.

RTGS transfers, the Central Bank of Sri Lanka (CBSL)-operated system for large-value interbank payments, were the dominant mode of payment. Eight applications paid via RTGS accounted for 80.5 million debentures worth Rs. 8.05 billion, or 65.6% of the total, an average of just over Rs. 1 billion per application.

Payments by Letter of Guarantee came to Rs. 3.5 billion for 35 million debentures from three applications, or 28.5% of the total.

In contrast, payments by bank drafts and cheques, which drew the highest number of applications at 20, amounted to Rs. 715.5 million for 7.16 million debentures, or 5.8% of the total value.

By type, Type A debentures attracted 25 applications for 99.01 million debentures worth Rs. 9.9 billion. Of this, RTGS transfers accounted for Rs. 5.95 billion from six applications, Letters of Guarantee for Rs. 3.25 billion from two applications, and bank drafts and cheques for Rs. 700.5 million from 17 applications.

Type B debentures drew six applications for 23.65 million debentures worth Rs. 2.37 billion. RTGS transfers accounted for Rs. 2.1 billion from two applications, a Letter of Guarantee for Rs. 250 million from one application, and bank drafts and cheques for Rs. 15 million from three applications.