01st May 2010, www.news.lk
'The Banker' which is known for providing 'Global Financial Intelligence' since the year 1926, in its 'Deals of the Year 2010' made the Democratic Socialist Republic of Sri Lanka the winner for 'Bonds SSAs' category along with joint lead manager and joint bookrunner RBS and JPMorgan for the US Dollars 500 million global bond offering.
Following the end of its 26-year civil war in May 2009, the Sri Lankan government has been eager to kick-start redevelopment and build a foreign investor base. In order to raise finance to fund its expansive post-conflict reconstruction programme, the Sri Lankan government launched its first international debt issue of $500m in five-year
bonds in October 2009.
Despite the overwhelming popularity of the issue, pricing the bonds proved a challenge: the country's outstanding bonds, executed in 2007, were highly illiquid, and while the market conditions at the time were broadly strong, the environment remained volatile. Following initial price talk of 8%, however, the issue was priced at 7.4%, well below the Sri Lankan government's initial target coupon, with a final order book of more than $6.8bn. At 13 times oversubscribed, the bond sale proved a huge success for an infrequent sovereign issuer amid untested investor appetite and has served as a major showcase for Sri Lanka, setting the stage for future issues.
Globally, with the economic environment still uncertain and markets often volatile, last year's deals demanded every ounce of tenacity and expertise available at corporates' relationship banks. The Banker's Deals of the Year are testament to those qualities.
From the markets' nadir in 2008, 2009 surprised virtually everybody by turning out to be something of a banner year for many investment banking businesses. Indeed, a handful of banks had record years in some sectors. Bond businesses, FIG capital raising and restructuring, among other areas, boomed. But against an uncertain economic backdrop, deals demanded slick execution skills and commitment to customers. The
Banker's judges considered 485 worldwide deals from more than 100 banks, with many breaking new ground, in new markets, for new names.