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Sri Lanka’s first ‘Green’ Asset Backed Securitization for hybrid vehicles

Sri Lanka’s first ‘Green’ Asset Backed Securitization for hybrid vehicles

Trillion Investments Limited associated with Pan Asia Banking Corporation PLC, to make a concerted effort to positively contribute to reduce carbon footprint in Sri Lanka and will be the first “green” asset backed securitization project worth LKR 750 Million with five-year duration focus on hybrid vehicles.

Review Based on Press Release on 28 October 2015.

Carbon footprint in Sri Lanka

“The total set of GHG (greenhouse gas) emissions caused directly and indirectly by an individual, organization, event or product”

green house gas emmision in sri lanka

Green house gas emission in Sri Lanka

Carbon footprint is a measure which is the impact of our activities have on the environment, in particular on climate change. It is associated to the amount of produced by humans during their day-to-day activities. The key focus area is the burning of fossil fuels to generate electricity and heating as well as for mobility and transportation. It is usually expressed in equivalent tons of carbon dioxide (CO2 equivalent) and calculated for a given time frame usually a period of a year. Carbon dioxide emissions are those stemming from the burning of fossil fuels and the manufacture of cement. According to the World Bank CO2 emissions (kt) in Sri Lanka was reported at 11763.74 in 2008.

sri-lanka-co2-emissions-metric-tons-per-capita-wb-data

Sri-Lanka-co2-emissions-world bank-data | source : Trade Economics

Investment Management & Advised Support

Trillion Investments Limited (Trillion), is a value creator and Investment Manager regulated by the Securities and Exchange Commission of Sri Lanka. Trillion is proudly corporate to lead the issue of investment with Pan Asia Banking Corporation PLC first “green” asset backed securitization project operate towards to reduce carbon foot print in Sri Lanka. The investment major focus is to provide financial support for hybrid vehicles which is an emerging trend according to department of motor traffic and external studies is 75% of New Vehicles in Sri Lanka are Hybrids.

During the press release, Kenneth De Zilwa, Chairman of Trillion Investments Limited, stated “We are proud to have structured Sri Lanka’s first ‘green’ asset backed securitization and enjoyed the experience of associating with Pan Asia Bank, ably led by their CEO Dimantha Seneviratne, whose dynamism is demonstrated by this bold step toward reducing carbon footprint in Sri Lanka. We look forward to working with Pan Asia Bank in the future, and we are sure Trillion will be part of many more firsts as we are working on a couple of innovative mandates.”

He also thanked Tyrone Hannan Head – Global Transaction Banking at Deutsche Bank, Neomal Goonewardena, Partner at Nithya Partners and Sampath Jayawardena Director – Transaction Advisory Services, during his statement who enthusiastically worked towards the fruition of this deal.

Asset-Backed Securitization

Asset-backed securities, called ABS, are bonds or notes backed by financial assets. Financial institutions that originate loans including banks, credit card providers, auto finance companies and consumer finance companies turn their loans into marketable securities through a process known as securitization. Here on this issue there will be a bond-like instruments that pay investors income based on car leases.

Association and Contribution with Proposed Venture

Pan Asia Banking Corporation PL has recorded its PAT by 197% to Rs. 300.2 million for the quarter ended September 30, 2015 with improved performance from all segments. Also Pan Asia Bank has always played a pivotal role in championing the green cause which proved by introducing the Hybrid leasing and lending for solar energy solutions in Sri Lanka.

Director/CEO, PAN ASIA BANKING Corporation PLC Mr. Dimantha Seneviratne address the media and stated PAN ASIA is glad of this enrollment of project which will secure environmental friendly assets in Sri Lanka. Mr. Seneviratne was highlighting this green asset backed securitization transaction is a clear demonstration of the bank’s commitment to support green initiatives as a responsible corporate citizen and also to grow the portfolio profitably through sophisticated corporate debt instruments such as these to boost Sri Lanka debt capital market instruments.

Deutsche Bank acts as Trustee and Administrator to the Issue, and Tyrone Hannan, Head – Global Transaction Banking, Deutsche Bank, said the bank is the Trustee and Administrator to the issue.

“This first time issue opens up a new source of funding opportunities for investors.” E&Y was the financial due diligence adviser and Nithya Partners acted as Legal Counsel to the Issue.

Present at Press Brief
Dimantha Seneviratne, Director/CEO, Chandrika Ranawaka, Head of Corporate Banking, Richie Dias, DGM/Head of Treasury and Varuni Egodage, Head of Legal represented Pan Asia Bank at the briefing, whilst Deutsche Bank was represented by Tyrone Hannan, Head – Global Transaction Banking, Nithya Partners by their Partner Neomal Goonewardena, and E&Y by their Director of Transaction Advisory Services, Sampath Jayawardena.

Lakmali Wickramasooriya, Executive Director and Sampath Kulatunga Director/CEO, also represented Trillion at the media briefing. Abdul Wahid a senior Investment professional, with extensive international exposure and experience, a former CFO – Private Equity Funds at The Abraaj Group, advised Trillion on the structure of the transaction.

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