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Bondholders frustrated by slow progress of talks
ECONOMYNEXT –Some of Sri Lanka’s bondholders who were willing to negotiate a deal before a judgment was delivered in a case filed by holdout investor Hamilton Reserve, are frustrated at what is seen as no progress in discussions, sources familiar with their thinking said.
While Hamilton Reserve has gone to court claiming to represent a 250 million dollar or 25 percent share in a billion-dollar bond with a so-called ‘single series’ collective action clause, a large majority of bondholders who have other bonds, have formed a committee to negotiate with Sri Lanka.
Western governments including the US and France have asked that the court action be stayed until negotiations with other bondholders conclude, but prospects of a deal being concluded by the time the first deadline given by the court has now dimmed. It is not clear yet whether a second extension could be obtained from court.
If Hamilton Reserve gets a court order in their favour, before an in-principle deal to re-structure sovereign bonds is reached, other investors who were willing to negotiate and take a haircut, would not be happy, the sources said.
If Sri Lanka concludes a deal with bondholders who are willing to negotiate, they could also support Sri Lanka to use other legal options including ‘exit consents‘ procedures with a super majority of 66.66 percent to weaken holdout bonds, the sources said.
For such a move, Sri Lankan banks who are also substantial owners of the bonds in question would have to participate.
Sri Lanka has already rejected a proposal by the ad hoc committee formed by private investors to exchange a bond which will be tied to developments in gross domestic product, a so-called state contingent bond, which had substantially high coupons in the initial stages.
Latest News
IMF Executive Board approves US$206 Million in Emergency Financial Support for Sri Lanka
The IMF Executive Board approved emergency financing under the Rapid Financing Instrument (RFI), providing Sri Lanka with immediate access to SDR 150.5 million (about US$206 million,
equivalent to 26 percent of quota) to help Sri Lanka address the urgent needs arising from the catastrophic Cyclone Ditwah and preserve macroeconomic stability.
In response to severe weather impacts, the Sri Lanka Navy conducted a diving and technical assistance operation on Friday (19 Dec 25) to clear major debris obstructing vital infrastructure.
Heavy rainfall caused a significant rise in the water level of the Mahaweli River, washed large quantities of debris, including logs and bamboo, downstream. These remain lodged in the Diyakapanathota in Gatambe, Peradeniya and Lewella bridges, obstructing the smooth flow of water.
Acting promptly upon request, a Navy diving team executed a coordinated operation in collaboration with the Road Development Authority. The team removed the accumulated debris, restoring normal water flow through the bridges.
Latest News
Landslide early warnings issued to the districts of Badulla, Kandy, Kurunegala, Matale and Nuwara-Eliya extended till 8AM on Sunday (21)
The Landslide Early Warning Centre of the National Building Research Organization (NBRO) has extended the Landslide Early Warning issued to the districts of Badulla, Kandy, Kurunegala, Matale and Nuwara-Eliya till 08:00AM on Sunday (21st December 2025)
The LEVEL III RED landslide early warnings issued to the Divisional Secetaries Divisions and surrounding areas of Medadumbara, Doluwa, Ududumbara and Minipe in the Kandy district, and Nildandahinna, Hanguranketha, Mathurata and
Walapane have been extended.
LEVEL II AMBER landslide early warnings have also been issued to the Divisional Secetaries Divisions and surrounding areas of Soranathota, Hali_Ela, Passara, Meegahakivula, Badulla, Lunugala and Kandeketiya in the Badulla district, Thumpane, Harispattuwa, Udapalatha, Kundasale, Akurana, Poojapitiya, Udunuwara, Pathadumbara, Pasbage Korale, Gangawata Korale, Hatharaliyadda, Yatinuwara, Ganga Ihala Korale, Panvila, Pathahewaheta and Deltota in the Kandy district, Rideegama in the Kurunegala district, Ukuwela, Naula, Matale, Ambanganga Korale, Rattota, Pallepola, Wilgamuwa, Yatawatta and Laggala Pallegama in the Matale district, and Nuwara-Eliya in the Nuwara-Eliya district.
LEVEL I YELLOW landslide early warnings have been issued to the Divisional Secetaries Divisions and surrounding areas of Uva Paranagama, Welimada, Haputhale, Haldummulla, Ella and
Bandarawela in the Badulla district, Alawwa, Mallawapitiya,
Polgahawela and Mawathagama in the Kurunegala district, and Kothmale East, Ambagamuwa Korale, Kothmale West, Thalawakele and Norwood in the Nuwara-Eliya district.
IMF Executive Board approves US$206 Million in Emergency Financial Support for Sri Lanka
Navy clears major bridge obstructions in Peradeniya and Lewella
Landslide early warnings issued to the districts of Badulla, Kandy, Kurunegala, Matale and Nuwara-Eliya extended till 8AM on Sunday (21)
Trump says US launched large-scale attacks on ISIL in Syria
Showers will occur in the Eastern, Western, Sabaragamuwa, Southern, Uva and Central provinces and in Polonnaruwa district
PM says govt. will introduce a new Constitution to abolish executive presidency
‘Dates have the highest sugar content to fight Coronavirus’
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