Sanasa Life raises Rs. 500 m via fully subscribed Tier II debenture issue

Friday, 3 July 2026 00:21 - - {{hitsCtrl.values.hits}}

Proceeds placed in escrow pending lifting of insurance licence suspension by IRCSL upon achievement of solvency requirements
Post-issue CAR improves to between 141% and 160%, comfortably above 120% regulatory minimum

Sanasa Life Insurance Company PLC has fully subscribed a Rs. 500 million subordinated debenture issue aimed at strengthening its capital base and supporting the lifting of regulatory restrictions on its insurance licence, the company said.

The company said it had successfully placed 5 million unrated, unlisted, unsecured, cumulative, redeemable Tier II subordinated debentures with identified investors through a private placement, in compliance with conditions set by the Securities and Exchange Commission of Sri Lanka (SEC).

The issue, which carried a lock-in clause, was completed on 26 June, with proceeds amounting to Rs. 500 million held in an escrow account pending regulatory clearance.

The funds will remain in escrow until the Insurance Regulatory Commission of Sri Lanka (IRCSL) lifts the suspension on the company’s insurance licence, following confirmation that it has met the required capital adequacy thresholds under the Risk-Based Capital (Solvency Margin) Rules of 2015.

The company said the capital raise significantly strengthens its solvency position.

Based on its monthly returns as at 31 May 2026, Sanasa Life said its Capital Adequacy Ratio (CAR) would stand at 141% if the debenture proceeds are treated as cash in escrow, and at 160% if the funds are assumed to be invested in Government securities.

Both scenarios remain well above the regulatory minimum CAR requirement of 120% and the minimum total available capital (TAC) requirement of Rs. 500 million stipulated by the IRCSL.

However, the company noted that the figures remain subject to change depending on the 30 June valuation, which will be disclosed separately to the market.

Following the completion of the issue, Sanasa Life has formally requested the IRCSL to lift the suspension on its insurance licence, citing compliance with the required solvency benchmarks.

The regulator has requested additional information from the company, the company said.

The transaction was carried out in line with conditions set out in the SEC’s approval letter dated 6 April 2026.