Debt Call

Pan Asia Bank is coming out with an unlisted Rs. 400 mn debenture, to raise funds to boost its capital.
The five-year issue is priced at floating rate of three percent above the six-months treasury bill rate. Six-month treasury notes are currently trading at 7.17 percent in the secondary market.rn

rnThe bank said Tuesday that the funds would be raised in two stages endash Rs. 250 mn in the first stage and Rs. 150 mn in the event of an oversubscription. rn

rnCommercial Bank will act as trustees to the issue. The issue opens on October 30.rn

rnThe debenture comes after Pan Asias shareholders recently injected Rs. 100 mn into the bank, to top up its capital.rn

rnThe bank called up the balance two rupees due from each Rs. 10 share recently, as part of an overall strategy to raise its capital and eventually seek a listing on the Colombo Stock Exchange next year. rn

rnShareholders who came forward with the extra cash includes: the Samurdhi Authority, Kuwait-Bahrain Exchange Company (a leading financial services provider in the Middle East), and businessman Dammika Perera (currently the banks single largest shareholder, owning 10 percent). rn

rnSince starting off eight years ago, Pan Asia currently has 13 online branches in the districts of Colombo, Gampaha, Kandy, Kurunegala, Matara, Negombo and Ratnapura. It has a customer base of over 18,000 and deposits exceeding Rs. 4 bn.rn

rnThe bank plans to open nine more branches within the next 18 months. rnldblquote We will also strengthen our human resources, linkup with an international ATM network, launch a credit card, and upgrade our IT system to keep pace with our rapid growth and technological changes,
dblquote CEO R Nadarajah said.rn


-By LBO Newsdesk;