Sri Lanka picks Citigroup as sovereign rating advisors

Sri Lanka has picked Citigroup N. A. as an advisor for its upcoming sovereign rating, the Central Bank said Monday. Sri Lanka has picked Citigroup N. A. as an advisor for its upcoming sovereign rating, the Central Bank said Monday. The country rating is being carried out on the recommendation by the Sovereign Rating Steering Committee, the bank said in a statement.

Central Bank Governor Sunil Mendis said last month that the sovereign rating will be sought before Sri Lanka sells dollar denominated bonds. The country rating, he says, will come in handy as the island steps up its investment drive.

The island nation in the past has raised dollar bonds without a rating.

Past issues of dollar denominated development bonds were brought mainly by locally based financial institutions.

The government is now planning to tap the international market to retire some of the older more expensive dollar debt and to streamline the borrowing programme.

Sri Lanka Telecom is the only company so far to secure an international rating. Fitch Ratings International and Standard & Poor’s rates SLT’s foreign currency debt B+ and its local currency debt BB-, both junk ratings reflecting the high-yield, high-risk nature of the company’s debt.

Sri Lanka’s total debt as at end 2004 was Rs. 2.1 trillion or US$ 21.3 bn up from Rs. 1.9 trillion in 2003.

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