Sri Lanka Commercial Credit to sell 20-pct debentures

Jan 21, 2013 (LBO) – Commercial Credit and Finance Plc, is selling 250 million rupees of 5-year debentures paying of 20 percent a year with an option to sell further 250 million rupees worth if there is strong demand, managers to the issue said. Merchant Bank of Sri Lanka, which is managing the sale said, interest will be paid quarterly giving an annual effective rate of 21.55 percent.

The debenture will be listed and free of withholding tax as announced in the budget for 2013.

Commercial Credit will be the first company to sell debentures under the new tax break.

Subscriptions will open on January 23.

RAM Ratings Lanka has rated the debentures ‘BB’.

The company reported net interest income of 1.16 billion rupees, during the six months to September 2012, up from 723.2 million rupees a year earlier, the Merchant Bank said.

Profit for the six months was 270.3 million rupees and the firm had gross assets of 12 billion rupees.