Norfund To Boost Sri Lankan Economy With NDB Partnership
Posted 8,March

By Chaveendra Dunuwille

In Local News

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Awarded as the best bank of Sri Lanka in 2020 by Banker Magazine UK, it is also the first & only Sri Lankan Cooperate to date to be awarded the Economic Dividend for Gender Equality (EDGE) certification, NDB is Sri Lanka’s fourth largest commercial bank and one of its fastest growing recording a growth of 18.4% valuing at LKR 632.1billion.

The Bank has partnered with the Norwegian Governments Investment Fund, Norfund in a historic deal commemorated with the exchange of agreements between the Norwegian Ambassador Trine Jøranli Eskedal & NDB Chairman Eshana de Silva.Widely considered as a game changer that will help reinvigorate and develop the private sector particularly focusing on the SME sector, financial inclusions and digital technologies.

Sri Lanka was added to the list of Norfunds mandated countries in 2019 and is expected to participate in NDB’s upcoming Rights Issue valued at LKR 8 billion. Announced in October 2020 the value per share is considered as LKR 75. By subscribing to unsubscribed rights & private placements the share price is expected to rise to LKR 82.50 per share a recorded 10% premium on the rights. In case the rights issue is fully subscribed by the existing shareholders NDB’s capital will be boosted by LKR 11 billion thus increasing its foreign shareholding percentage to approximately 21%.

This deal is historic in the fact that this is Norfunds first investment for 2021 and it’s the funds first equity investment in Sri Lanka. Coincidently this is NDB’s first foreign equity placement agreement.

As part of the agreement NDB will have access to vast long term funding by Norfund which possesses $2.8 billion in investments across 163 projects across the globe. The fund has also listed out 29 core strategy countries in Asia, Latin America and Africa.

Both sides share positive outlooks on this historic agreement and seek to use these new found relations to further strengthen the local economy hit hard by the Covid -19 pandemic.