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Sri Lanka to offer new restructuring plan to bondholders, report

21 February 2024 01:31 pm - 4     - {{hitsCtrl.values.hits}}

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(Bloomberg) -- Sri Lanka sent a new restructuring proposal to dollar bondholders through its adviser Lazard as the South Asian nation seeks to complete overhauling its defaulted debt, according to people familiar with the matter.

A counter proposal to a bondholder group’s offer in October for a 20% haircut and the issuance of macro-linked bonds was conveyed through Lazard, the people said, declining to be named because negotiations are private. They did not elaborate on the details of the offer. Government representatives may travel to London soon to meet Sri Lanka’s commercial creditors, one of the people said.

Completing the overhaul of Sri Lanka’s $27 billion of foreign debt is critical to ensure financing from the International Monetary Fund bailout keeps flowing. President Ranil Wickremesinghe said this month that authorities expect to complete the restructuring within the first six months of the year.

Calls to Sri Lanka’s treasury secretary, junior finance minister and central bank governor went unanswered. Representatives of the bondholder group and Lazard weren’t immediately available for comment.

The government had already struck restructuring deals with official creditors, including China, India and the Paris Club as well as with holders of its local debt. 


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  Comments - 4

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  • Small bites to recover Wednesday, 21 February 2024 02:23 PM

    If Sri Lanka focusses on increasing Dollar revenue and decreasing Dollar outflow it will help build up the dollar reserve at a higher growth rate. Eg. release (no mans land) forest reserves for a 5 year period to be self sufficient with zero imports of maize (chicken feed), B onions, Red Chillies, Potatoes, sugar and give loans to private businessman to set up tin fish industries. stop total import of these items. Give loans to existing Fish exporting companies to double their fleet of fishing trawlers and ships and increase fish/crab/lobster exports. Just an illustration of how small steps will make a big impact. Improve train service Aluthgama to Gampaha to have airconditioned office trains every 7 minutes during peak office to and from time to reduce the consumption of fuel on private vehicles. RW has been at the helm for 2 years now. High time he shows some political decisions in addition to the macro solutions CBSL is driving.

    20% haircut makes the it good business for the government Wednesday, 21 February 2024 08:55 PM

    No Sri Lankan would in their right minds ever want to buy Sri Lankan bonds again. It will be only fool overseas idiots with too much money who will come back for more when what they lent is cut to only 80%.

    Zak Thursday, 22 February 2024 02:32 AM

    Ranil will keep kicking the can down the street till next elections. Nothing will be finalised till then. So the new gov can pick it up. People will start saying Ranil was better than the next mob as who ever comes next will have to start paying debt. It’s sad how even the english speaking society gets fooled by this man

    Be reasonable Thursday, 22 February 2024 07:07 AM

    Just go for a 50% haircut. Not more.


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