Commercial Bank debenture issue oversubscribed, closes on first day

Commercial Bank of Ceylon PLC's Basel III compliant Tier 2 listed rated unsecured subordinated redeemable debenture issue was oversubscribed on its opening day, prompting the Bank to close the issue at 4.30 p.m. on July 16.

The Bank said it received applications for more than 200 million debentures, amounting to Rs. 20 billion, exceeding the total amount offered under the issue.

Commercial Bank initially offered 100 million debentures at a par value of Rs. 100 each to raise Rs. 10 billion. In the event of oversubscription, the Bank had the option to issue an additional 100 million debentures in two tranches of 50 million debentures each, raising a further Rs. 10 billion, bringing the maximum issue size to Rs. 20 billion.

Following the oversubscription, the Bank exercised its option to close the issue in accordance with the prospectus. The basis of allotment will be announced to the Colombo Stock Exchange (CSE) in due course.

Commercial Bank also noted that the inclusion of the debentures as Tier 2 capital remains subject to approval from the Central Bank of Sri Lanka (CBSL). The Bank has submitted the required application and is awaiting regulatory clearance. Once approval is granted, the proceeds from the issue will be recognised as Tier 2 capital.