Leapfrog group buys Sri Lanka Soflogic Life Insurance stake from FMO

ECONOMYNEXT - A 19-percent stake in Sri Lanka's Softlogic Life Insurance has been sold by the Netherlands-based FMO to the Leapfrog Investments group, which has a focus on Asia and Africa.

"This investment reveals our positive view of Sri Lanka's long-term trajectory, and its financial services industry," Leapfrog Chie Executive Andrew Kuper said in a statement.

Softlogic Chairman Ashok Pathirage said exiting partner FMO helped strenghten the firm.

He hoped the investment in his insurance unit woudl be the first of many investments in Sri Lanka.

The stake changed hands in two blocks, one of 35.6 million shares at 30.80 rupees each and the other of 35.6 million shares at 30.70 rupees each, down 19-20 percent from the previous, opening trade.

The total value of the 71.2 million shares traded was 2.18 billion rupees. The transaction amounted to a 19 percent stake in Softlogic Life Insurance, formerly Asian Alliance Insurance.

Sri Lanka’s Commercial Bank to raise Rs7.5bn through debenture issue

ECONOMYNEXT – Sri Lanka’s Commercial Bank of Ceylon said it plans to raise 7.5 billion rupees through a new debenture issue with an option to double the amount in the event of an oversubscription.

A statement said the bank will issue 75 million listed, unsecured, rated, redeemable subordinated Basel III compliant debentures at 100 rupees each with a non-viability conversion feature,making them hybrid instruments convertible into equity.
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The debentures, which will have a minimum tenure of five years and maximum tenure of 10 year, are subject to shareholder and regulatory aproval.

Sri Lanka's Lighthouse Hotel in Rs450mn upgrade

ECONOMYNEXT – Sri Lanka’s Lighthouse Hotel said it will invest 450 million rupees to refurbish and upgrade rooms, public and service areas and plant and equipment next year.

A stock exchange filing said 63 out of 85 rooms of the Jetwing Lighthouse on the south coast will be upgraded from May to July 2019.

The remaining 22 rooms will be operational during the period, usually considered the ‘off-season’ when tourist arrivals fall.

The hotel will be fully operational by August 2019.

Sri Lankan rupee hits record low on foreign outflows

Reuters: ** The Sri Lankan rupee fell to a record low on Wednesday due to continued outflows of foreign funds mainly from government bonds as political uncertainty dented investor sentiment.

** The rupee hit an all-time low of 181.85 to the dollar in early trade, surpassing its previous record of 181.67 marked in the previous session. It has weakened about 4.8 percent since Sri Lanka’s political crisis began on Oct. 26, and lost 18.4 percent so far this year. 

** The rupee ended at 181.80/182.00 per dollar, compared with 181.50/70 in the previous session.

** President Maithripala Sirisena appointed a 30-member cabinet last week after he was forced to reinstate Ranil Wickremeinghe as prime minister, 51 days after he was sacked.

** The political crisis was expected to ease, though uneasy relations between the two men could cause fiscal problems, analysts have said. Parliament approved 1.77 trillion rupees ($9.39 billion) to meet four months of expenditures and avert a government shutdown from Jan. 1. 

** The Colombo stock index ended 0.09 percent weaker at 6,019.62 on Wednesday. Turnover was 670.9 million rupees, below this year’s daily average of 840 million rupees.

** Foreigners were net buyers of 344.7 million rupees ($1.9 million) of stocks on Wednesday. They have been net sellers of 13.3 billion rupees since the political crisis began. The bond market saw outflows of about 56.7 billion rupees between Oct. 25 and Dec. 19, central bank data showed. 

** Five-year government bond yields have risen 25 basis points since the political crisis began. 

** Credit agencies Fitch and S&P downgraded Sri Lanka’s sovereign rating in early December, citing refinancing risks and an uncertain policy outlook.

($1 = 181.4000 Sri Lankan rupees) 

(Reporting by Shihar Aneez; editing by John Stonestreet)