Lending for SriLankan

A consortium of local banks sealed a deal with SriLankan Airlines for a full dollar loan of US$ 22.5 million this week. A consortium of local banks sealed a deal with SriLankan Airlines for a full dollar loan of US$ 22.5 million this week. The syndicate loan arranged by Commercial Bank priced at LIBOR +2.35 percent is one of the largest and longest term, full dollar loans raised locally.

The arrangers said most banks are now capable of facilitating longer-term dollar loans.

“Most local banks have demonstrated their capability in lending short and long term dollar loans. It was not the case earlier,” says Amitha Gooneratne, MD, Commercial Bank.

Foreign currency deposits have been growing over the years.

For instance Commercial Bank’s foreign currency deposits jumped three fold to Rs. 28 billion in the last four years.

In the first half of this year foreign currency deposits were up 5 percent in dollar.

The increase in rupee terms was however lower due to depreciation.

HNB’s Foreign Currency Banking Unit’s deposits have risen by 14 percent last year; in the same four year period dep