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Portfolio/Softlogic Finance

LKR 1.4 billion credit guarantee of long term senior funding raised by Softlogic Finance

Softlogic
Transport
Sri Lanka

Overview

DATE OF TRANSACTION

DECEMBER 2013

COUNTRY

Sri Lanka

FINANCING PARTNERS

VARIOUS LOCAL INVESTORS, PENSIONS FUNDS AND MUTUAL FUNDS

GUARANTCO GUARANTEE

LKR 1.4 BILLION (USD 10.5 MILLION)

Sector

Transport

TOTAL TRANSACTION AMOUNT

LKR 1.4BN

GuarantCo Benefits

Softlogic needs to continually raise long term funding in line with the rising demand for its commercial vehicle and other loans. However, due to the limitations of the Sri Lankan market, it is able to access only short term, relatively expensive funding, which puts pressure on its profitability and also leads to Asset / Liability mismatches.

In order to access Sri Lanka’s debt capital markets, the best source for long term finance for it, Softlogic requires GuarantCo’s assistance. The facility of LKR 1.4bn provided to Softlogic enables it to raise 5-year affordable funds through a pioneering credit enhanced Non Convertible Debenture issuance

Development Benefits

Softlogic finances small commercial vehicle owner-operators and other transport linked businesses, most of whom would otherwise not have access to formal financing from banks.

The demand for Softlogic’s loan/ lease products is rapidly rising due to Sri Lanka’s strong economy, but raising funding to meet such growth is challenging.

GuarantCo’s support enables Softlogic to raise affordable long term finance for the benefit of its customers. The facility will also help in the development of Sri Lanka’s debt capital markets by increasing the acceptability of credit enhanced instruments.

ALL PROJECTS

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Agricultural Infrastructure Agriculture Energy Gas ICT/Telecoms Inputs to Infrastructure Manufacturing Oil Power Transport Urban Infrastructure Water / Waste services

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