Sri Lanka raises $1bn in debt sale despite IMF warning

Sri Lanka said Tuesday it had raised $1 billion through a sovereign bond issue despite a warning by the International Monetary Fund against increasing its foreign borrowing. The central bank said the five-year bond, offering an annual six percent yield, was more than three times oversubscribed within hours of opening Monday. The bank said 62 percent of the bonds were bought by U.S. investors and Europeans took 26 percent while Asian investors made up the remainder of the buyers. Sri Lanka went ahead with the issue despite a warning by the IMF late last year that its external debt was too high and repayments were becoming a big burden. The IMF said the island's short-term external debt was equivalent to over half its foreign reserves.