Seylan Bank Rs. 15 b listed debenture snapped up on opening day

Seylan Bank PLC’s Basel III-compliant Tier II listed debenture, raising up to Rs. 15 billion, was oversubscribed on the opening day on Wednesday having received strong market response, highlighting investor confidence in the bank’s resilient business model and long-term vision.

The Basel III-compliant Tier II, Listed, Rated, Unsecured, Subordinated, Redeemable debentures with a Non-Viability Conversion is at a par value of Rs. 100 each for an initial issue of 50,000,000 debentures, with an option to issue up to another 75,000,000 debentures and, in the event of oversubscription, to issue an additional 25,000,000 debentures at the discretion of the bank, raising a total amount of Rs. 15 billion. The debenture will be listed on the Colombo Stock Exchange.

Seylan Bank PLC Director/CEO Ramesh Jayasekara said: “Strengthening the bank capital structure aligns to prudent banking and supporting national economic priorities. The success of our Basel III compliant debenture will help us to meaningfully scale lending to the economy, particularly in empowering Sri Lanka’s vibrant Small and Medium Enterprise (SME) sector, accelerating export-oriented growth and uplifting agriculture. 

We are deeply grateful for the confidence the market has placed in Seylan Bank’s vision, and the bank’s commitment to building a future-ready, inclusive financial sector.” 

The debenture proceeds will be directed toward the bank’s three key strategic priorities: reducing maturity mismatches in the asset and liability portfolio, strengthening the Tier II capital base, and expanding the bank’s lending capacity in the critical SMEs, exports, and agriculture sectors. 

“In deploying capital where it is needed, Seylan Bank aims to actively support Sri Lanka’s economic recovery and future growth,” Jayasekara added. 

The bank has National Long-Term Ratings of A+ (lka) by Fitch Ratings Lanka Ltd., and the debenture issue has received an A- (lka) rating.

The issue had a diverse structure, with five and 10-year tenures and a blend of fixed and floating rate options such Type A, a 5-year carrying a fixed interest rate of 11.25% p.a. (AER 11.25%) payable annually, Type B, a 5-year carrying a fixed rate of 10.80% p.a. (AER 11.25%) payable quarterly, Type C, a 5-year carrying a floating rate of 364 days T-bill rate +2.5% with a cap of 11.50% and floor of 9.5%, payable annually, Type D, a 10-year carrying a fixed interest rate of 11.75% p.a. (AER 11.75%) payable annually, and Type E, a 10-year carrying a fixed rate of 11.40% p.a. (AER 11.72%) payable semi-annually. The blend of fixed and floating rate options caters to varying risk-return appetites.

The debenture issue also cements the bank’s continued alignment with regulatory expectations and its proactive role in fostering macroeconomic stability. It also reflects a broader commitment to offering impactful financing solutions that are rooted in sustainability, customer trust, and responsive innovation.

Seylan Bank’s position has been strengthened through disciplined balance sheet management, digital banking innovations, and customer-centricity. With over three decades of service, the bank now enters a growth phase focused on resilience and economic value creation.

This strategy delivered outstanding results. In 2024, the bank achieved a Rs. 10.05 billion Profit after Tax (PAT), a 61% growth and the highest-ever performance in its 36-year history, despite challenging conditions. Momentum continued in 2025 with a first quarter PAT of Rs. 2,761 million, up 20.29% from the previous year.

The issue was jointly managed by the People’s Bank Investment Banking Unit and First Capital Advisory Services Ltd.