Colombo, 25 September 2026 – DFCC Bank PLC is poised to strengthen its capital base and offer a new investment avenue, as its Basel III compliant, listed, rated, unsecured, subordinated, redeemable debentures with a non-viability conversion feature are officially slated for listing on the Colombo Stock Exchange (CSE) on Monday, September 28th, 2026. This announcement comes via a circular issued by the CSE today, detailing the upcoming listing.
The move marks a significant development for both DFCC Bank and the Sri Lankan financial market, providing investors with an opportunity to engage with a fixed-income instrument that adheres to stringent international banking regulations.
Key Details of the Debentures
The new debentures, identified by the Security ID DFCC-BD-21/0 9/31-C2643-13 and ISIN LK0055D26436, are structured as a 5-year fixed coupon instrument. Investors will benefit from an attractive annual fixed coupon rate of 13.00% p.a., with the Annual Effective Rate (AER) also standing at 13.00%, payable annually.
These debentures come with several distinct characteristics:
- Basel III Compliant: Adherence to the latest international regulatory framework for banks, aimed at improving bank capital, stress testing, and market liquidity risk.
- Listed: Will be publicly traded on the Colombo Stock Exchange, providing liquidity and price transparency.
- Rated: Independent credit rating assigned, offering an assessment of creditworthiness.
- Unsecured: Not backed by specific collateral.
- Subordinated: In the event of liquidation, claims are junior to those of senior creditors but senior to equity holders. This typically entails a higher yield for the investor.
- Redeemable: The bank has the obligation to repay the principal amount to debenture holders on maturity.
- Non-Viability Conversion Feature: A crucial Basel III requirement, this feature allows for the debentures to be converted into equity or written down under specific conditions if the bank faces a “point of non-viability,” safeguarding the financial system.
Implications for Investors and the Market
The listing of these debentures offers a compelling investment opportunity for individuals and institutional investors seeking stable, fixed-income returns in the Sri Lankan market. The 13.00% annual coupon rate presents an attractive yield over a five-year period, particularly for those looking to diversify their portfolios with instruments from a reputable financial institution like DFCC Bank.
From DFCC Bank’s perspective, issuing Basel III compliant subordinated debentures is a strategic step towards enhancing its regulatory capital, thereby bolstering its resilience and supporting its growth objectives in line with international banking standards.
The Colombo Stock Exchange continues to facilitate capital market activities, enabling listed entities like DFCC Bank to raise necessary funding while providing a regulated platform for investors to participate in the nation’s economic progress.
This listing is a testament to DFCC Bank’s commitment to robust financial practices and its continued contribution to the dynamism of Sri Lanka’s capital markets.
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