Sri Lanka wallows in demand for bond return

The sovereign's latest debt offering gets an overwhelming reception after it reaches an agreement with the IMF for its next tranche of funding.

The Democratic Socialist Republic of Sri Lanka made a highly successful return to the international bond markets on Thursday with a $1.5 billion bond issue, attracting record-breaking demand despite tight pricing relative to secondary market levels.

The final order book stood at $11 billion, which was not only a record for the single-B rated country but was also strong by the standard of recent emerging market deals, which have benefited from high liquidity thanks to robust emerging market fund inflows.

By contrast, Sri Lanka’s last $1.5 billion two-tranche international bond deal in July 2016 attracted a $5.5 billion peak order book.

But timing...

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