World Economy

Appetite Grows for Lanka Bonds

Appetite  Grows for Lanka BondsAppetite  Grows for Lanka Bonds

Sri Lanka raised $1.5 billion in its first sale of dual-tranche eurobonds at a lower borrowing cost than initially expected, as yield-hungry global investors put in $6.6 billion in offers, Reuters reported. Asian sovereign bonds have rallied this year as investors look for better returns in a low-rate environment. That appetite has grown since Britain’s vote to leave the European Union sent more money into safe-haven assets such as government bonds. The government raised $500 million from a 5-1/2-year tranche and $1 billion from a 10-year tranche. The 5-1/2-year bond priced at a yield of 5.75% and the 10-year bond at 6.82%, a source close to the deal told Reuters. In early deals the new bonds due 2022 were trading at 101.25 cents on the dollar and those due 2026 were at 101.875, higher than the pricing level of 100, indicated by brokers.