Co-op Capital

Sri Lanka’s Cooperative Leasing took its first tentative steps into the capital markets on Tuesday by pledging its tiny portfolio to raise cash for future funding needs. Sri Lanka’s Cooperative Leasing took its first tentative steps into the capital markets on Tuesday by pledging its tiny portfolio to raise cash for future funding needs. The two-year old leasing company – which is owned by over 1,800 multipurpose cooperative societies and banks – raised Rs. 60 million by securitising part of its Rs. 200 million portfolio to micro finance lender Wayamba Cooperative Rural Bank Union.

Capital Alliance Holdings, who structured and placed the deal, hopes other micro finance lenders will take a cue from this pioneering initiative.

“World over micro finance institutions tap the capital markets for their funding needs. Unlike traditional forms of lending, cooperative banks have the reach. But they have been slow to tap our capital markets,” notes Ajith Fernando, Chief Executive of Capital Alliance Holdings.

Depending on the success of this maiden issue, Cooperative Leasing’s CEO Chandana Kumarage, plans to raise a further Rs. 40 million within the next six months.