Sri Lanka raises $111.5m from SLDBs sold after auction

ECONOMYNEXT – The government has raised US$111.5 million through the direct sale of Sri Lanka Development Bonds sold after auction, the central bank said.

“Investments in SLDBs during the above period were spread across maturities ranging from 3 months to 5 years, attracting large volumes as well as eligible retail investors,” the central bank said in a statement.

“In collaboration with some Sri Lankan missions, CBSL has also reached out to eligible investors in these jurisdictions to further popularize investment in SLDBs.”

SLDBs are available in denominations as small as US$1000, which immediately expanded the market.

It also generally improved returns for holders of small dollar deposits and encouraged savings.

However, the central bank imposed a rule that prevented dollar earners from saving in US dollars, as their money was forcibly converted.

As a result, these wage earners instead of saving buy durable consumer goods and other items.

The full statement is reproduced below:

Funds raised through the direct issuance of Sri Lanka Development Bonds

The Central Bank of Sri Lanka (CBSL) has introduced various measures to encourage investment in Sri Lanka Development Bonds (SLDB). Validating the effectiveness of the measures introduced, funds in the amount of $111.5 million were raised through the direct issuance of SLDB from January 1 to February 15, 2022.

Investments in SLDBs during the above period were spread across maturities ranging from 3 months to 5 years, attracting large volumes as well as eligible small investors. In collaboration with some Sri Lankan missions, CBSL has also reached out to eligible investors in these jurisdictions to further popularize investments in SLDBs.

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