2024/04/16

SRI LANKA ANNOUNCES CONCLUSION OF INITIAL RESTRICTED DISCUSSIONS WITH MEMBERS OF
THE AD HOC GROUP OF BONDHOLDERS
Colombo, Sri Lanka, 16 April 2024 – The Government of the Democratic Socialist Republic of Sri Lanka ("Sri Lanka")
announces today that it has held restricted discussions over the past three weeks (the "Restricted Period") with nine membersof the steering committee who agreed to take part in the restricted discussions (the "Steering Committee") of the Ad HocGroup of Bondholders (the "Group", and together with Sri Lanka, the "Parties") of its International Sovereign Bonds ("ISBs").
Sri Lanka was joined by its legal and financial advisors, Clifford Chance and Lazard, respectively, and the restricted membersof the Steering Committee were joined by the Group's legal and financial advisors, White & Case and Rothschild & Co,
respectively. The Steering Committee as a whole comprises ten of the largest members of the Group, with the Group
controlling approximately 50% of the aggregate outstanding amount of ISBs. Despite constructive discussions, the Parties did
not come to an agreement on restructuring terms. The Steering Committee did not agree to an extension of the restricteddiscussions upon expiration of the current Restricted Period.
During the Restricted Period, Sri Lanka, the Steering Committee and its advisors met during a two-day working session in
London on 27 and 28 March 2024 (the "Meetings") to discuss the Group's latest debt treatment proposal, sent to Sri Lanka's
advisors on 11 March 2024 (the "Group's March Proposal"). Prior to the meetings, on 25 March 2024, Sri Lanka had alsosent, through its advisors, its own debt treatment proposal to the Group's advisors ("Sri Lanka's Proposal") which was rejectedby the Steering Committee. Both the Group's March Proposal and Sri Lanka's Proposal are attached in the Annex hereto.
Prior to the Meetings, staff at the International Monetary Fund (the "IMF") provided their preliminary and informal assessmentof both Parties' proposals' consistency with Sri Lanka's IMF-supported program (the "IMF-Supported Program") parametersand debt sustainability objectives. The IMF staff assessment included an analysis of the sum total of restructuring proposals(for official and private creditors) based on agreed deals with certain creditors and the Sri Lankan authorities' restructuring
scenario for other creditors. On that basis, the IMF staff concluded that the debt treatment scenario included in Sri Lanka's
Proposal was consistent with the IMF-Supported Program debt sustainability targets, while the scenario included in the Group's
March Proposal was not. IMF staff noted that these were preliminary assessments and the IMF staff would provide final
assessments only after the Parties had reached a tentative agreement in principle.
During the Meetings, it was agreed that the primary basis for the discussions would be the Group's March Proposal. Sri Lanka
articulated the main reservations it had in relation to the Group's proposed Macro-Linked Bond ("MLB") – while members of
the Steering Committee articulated the reasons why they believed the terms of their MLB proposal were fair and reasonable.
The Steering Committee also suggested the possible introduction of a Governance Linked Bond, which Sri Lanka said it would
consider subject to being provided with more details of this proposal. Such details on the possible structure of a Governance
Linked Bond were subsequently shared with Sri Lanka’s advisors on 3 April 2024.
The discussions narrowed down to four features of the MLB:1.

The baseline parameters of the instruments proposed by the Group were calibrated by reference to the Group's"alternative baseline", rather than Sri Lanka's IMF-Supported Program baseline.

2.

The balance of risks between Sri Lanka and holders of its ISBs - While the Group had already updated its originalMLB structure to include a scenario where Sri Lanka might underperform IMF-Supported Program GDP projections,
Sri Lanka invited the Group to consider a structure that would provide greater protections to Sri Lanka in such a
scenario.

3.

The test for triggering upward/downward adjustments in the MLB.

4.

The share of additional value in an upward adjustment scenario - Sri Lanka invited the Group to consider lower
bondholder allocation in the scenario in which the country outperformed IMF-Supported Program GDP projections
and satisfied the upward adjustment test in the MLB.

Over the course of the Meetings, the Parties came closer to a meeting of minds on Items 1 and 2, with the Steering Committee
willing to agree to Sri Lanka's request for amendments in relation to these two key structural aspects, subject to Sri Lanka (i)agreeing to a consent fee (with the Steering Committee proposing a fee of 1.8% of the outstanding principal amount of theISBs) with a view to offsetting the Group's perceived reduction of the market value of their proposal as result of such
amendments and (ii) agreeing with the Group's proposal on Items 3 and 4.
Following the Meetings, on 3 April 2024, the Group shared an updated version of its debt treatment proposal (the "Group's
April Proposal"), which addressed Items 1 and 2 in the manner described above. The Group's April Proposal is also attachedin the Annex hereto. The Group's April Proposal is yet to be assessed by the IMF staff.
While recognising the efforts made by the Group in accommodating some of its key observations, Sri Lanka reiterated its
reservations regarding the structure of the MLB trigger test and the cashflows associated with the baseline and upside scenarios(Items 3 and 4).
Sri Lanka would like to thank the Steering Committee, the Group and their advisors for their constructive stance, and looks
forward to continued engagement in good faith as soon as feasible, with a view to reaching common ground in the next few
weeks, ahead of the second review of the IMF-Supported Program being considered by the IMF Executive Board.
This announcement is made by Sri Lanka and constitutes a public disclosure of inside information under Regulation (EU)596/2014 as it forms part of domestic law of the United Kingdom by virtue of the European Union (Withdrawal) Act 2018("EUWA") ("UK MAR"). For the purposes of UK MAR and Article 2 of Commission Implementing Regulation (EU)2016/1055 as it forms part of domestic law in the United Kingdom by virtue of the EUWA, this announcement is made by R
M P Rathnayake, Deputy Secretary to the Treasury of Sri Lanka.

ANNEX[included on the following page]10284504091-v1-2-

70-41037223

1.

Group’s March Proposal

Indicative term sheet for Macro-Linked Bonds (1/2)

Indicative terms of new bonds under an MLB structure1,2 (under Alternative Baseline)

Instrument
type

Bonds
instalments

Past Due Interest2

Notional
amount at
exchange date
(US$m)

PIK
accumulated(2023-2027,
US$m)

Coupon rate

Notional at end
2027 including
PIK (US$m)

Up to 2027
Cash

PIK

2028 onwards(cash)

1,678

2024

270

n.a.

n.a.

4.00%

n.a.

n.a.

2025

270

n.a.

n.a.

4.00%

n.a.

n.a.

2026

270

n.a.

n.a.

4.00%

n.a.

n.a.

2027

270

n.a.

n.a.

4.00%

n.a.

n.a.

2028

598

n.a.

n.a.

4.00%

n.a.

n.a.

New bonds instalments

10,040

2029

750

94

844

4.00%

3.00%

7.75%

2030

750

94

844

4.00%

3.00%

7.75%

2031

1,000

126

1,126

4.25%

3.00%

8.00%

2032

750

94

844

4.25%

3.00%

8.00%

2033

750

94

844

4.25%

3.00%

8.00%

2034

1,250

157

1,407

4.50%

3.00%

8.25%

2035

1,250

157

1,407

4.50%

3.00%

8.25%

2036

1,250

157

1,407

4.50%

3.00%

8.25%

2037

573

72

644

4.50%

3.00%

8.25%

2038

573

72

644

4.50%

3.00%

8.25%

2039

573

72

644

4.50%

3.00%

8.25%

2040

573

72

644

4.50%

3.00%

8.25%

Plain
Vanilla #1

MLB #1MLB #2MLB #3MLB #4

MLB #5◼

Post 20% nominal haircut on new
bonds

◼

No haircut on PDIs

Key evolutions of the MLB structure :◼

New bonds amortizing from 2029 (vs.
2027 previously)◼

Additional instalments introduced(final instalment in 2040 vs. 2036
previously)◼

Amended PDI amortization profile◼

Lower PIK coupons (3% vs. 4%
previously)◼

Observation period expanded from 2 to
3 years◼

Inclusion of a downward adjustment
below the IMF baseline

Note 1. Terms calibrated under a DSA based on public debt stock at end-2023
Note 2. “PDIs” capitalized into a new instrument. PDIs based on estimated past due interest accumulated at end Dec-2023, i.e. $1,678m (to be updated at the time of the debt exchange).

3

Indicative term sheet for Macro-Linked Bonds (2/2)
Overview of MLB adjustment mechanisms
Overview of GDP thresholds under the updated MLB structure

Downside adjustements
Baseline

US$ nominal GDP (avg. 2025-2027,
billion)Weighted incremental haircut1

Average coupon post 2028

Upside scenario

96.3

-

8.2%

GDP threshold #1

93.9

-

7.3%

GDP threshold #2

90.1

-

6.1%

GDP threshold #3

86.3

11%

5.4%

IMF baseline

84.2

19%

5.4%

Downside scenario

80.5

36%

5.0%

Note 1. Additional Haircut triggered by the adjustment (as a % of 2027 nominal including PIK)

4

2.

Sri Lanka’s Proposal

INTERNATIONAL SOVEREIGN BONDS INDICATIVE DEBT TREATMENTPROPOSAL

Introducing the Proposed “GDP-Linked A/B Bond” Solution
Bondholders would exchange their ISBs
holdings against a basket of:

7 A-Bonds + 1 PDI Bond

• Plain Vanilla Bonds, with no contingent features• Fixed cashflows, independent of macroeconomic developments• B-Bonds, with financial terms subject to adjustments in early 2028 byreference to Sri Lanka's macroeconomic performance up to such date

3 B-Bonds• Adjustments to the B-bonds would be based on a “dual one-time test”,
pursuant to which Sri Lanka’s USD GDP for 2027 would be compared
to reference levels but subject to actual cumulated real GDP growth in
the period 2024-2027

1

INTERNATIONAL SOVEREIGN BONDS INDICATIVE DEBT TREATMENTPROPOSAL

Indicative Initial Terms of the New Eurobonds (assuming 100% participation)
Indicative terms on the Eurobonds1

8 Plain
VanillaBonds

3 « MLBtype »Bonds

Final maturity

Nominal amountYear

In USDm

Up to 2028 (incl.)

PDI Bond

2024-2028
Progressive
amortization3

1,341

3.0%

A-Bonds

2029
2030
2031
2032
2033
2034
2035

791
879
879
879
879
879
879

2036
2037
2038

B-Bonds (before any
adjustments)

TOTAL AMOUNT

Notes:

Coupon rate2
From 2029 until 2032
(incl.)

From 2033 until maturity(incl.)

4.5%
4.5%
4.5%
4.5%
4.5%
4.5%
4.5%

6.0%
6.0%
6.0%
6.0%
6.0%
6.5%
6.5%

9.0%
9.0%
9.0%

966
879
879

4.0%
4.0%
4.0%

4.0%
4.0%
4.0%

4.0%
4.0%
4.0%

10,1264

Avg. 4.2%

Avg. 5.4%

Avg. 5.4%(1) The Republic of Sri Lanka reserves the right to merge/group some of the Eurobonds described above, to ensure a sufficient issuance size for each new instrument, (2) Semi
annual coupon payments, (3) Amortization schedule as follows: 15% of the outstanding amount yearly paid between 2024 and 2027, and 40% in 2028, (4) Overall haircut of 28.8%
on the outstanding claim (30% on the face value, 20% on PDIs).

2

INTERNATIONAL SOVEREIGN BONDS INDICATIVE DEBT TREATMENTPROPOSAL

Introduction to the Proposed B-Bonds
1•

Dual one-time test:➢ The adjusted financial terms of the B-Bonds would be determined by reference to a dual one-time test (conducted
in 2028), pursuant to which Sri Lanka’s USD Nominal GDP for 2027 would be compared to reference levels but
subject to actual cumulated real GDP growth in the period 2024-27➢ Reference levels for Sri Lanka’s USD GDP in 2027 would be set at 5%, 10%, 15% and 20% below and above thebaseline level, creating 9 different zones, associated with 9 different sets of financial parameters for the B-Bonds.
Adjustments to payments would be conditioned on the cumulative real GDP growth between now and 2027,
as compared to the baseline2•

Adjustment mechanisms:➢ Upside adjustments to the B-Bonds' baseline financial terms would be implemented by way of (1) accelerating
amortization, (2) increasing the principal amount (with the increase varying depending on the zone), and (3)increasing the coupon rates after 2028 (with the increase again varying depending on the zone)➢ Conversely, any downside adjustment in the payment terms of the B-Bonds terms would take the form of
downward adjustments to principal (subject to a floor at zero) and lowering of coupon rates

3•

Nature of the adjustments: Adjustments to financial parameters of the B-Bonds would be definitive and irrevocable3

INTERNATIONAL SOVEREIGN BONDS INDICATIVE DEBT TREATMENTPROPOSALThe Dual One-Time Test Determines the B-Bonds’ Adjustors
2

Distribution aroundthe IMF baseline

Test variable 2: Performance in cumulated real GDP growth (2024-2027) relative to IMF Baseline¹[… ; - 12%[[-12% ; - 7%[[-7% ; - 4%[[-4% ; 0%[[0% ; 4%[[4% ; 7%[[7% ; 12%[[12% ; …[[…; 69.8[

Adjustors#4-

Adjustors#3-

Adjustors#2-

Adjustors#1-

Baseline

Baseline

Baseline

Baseline[69.8; 74.1[

Adjustors#3-

Adjustors#3-

Adjustors#2-

Adjustors#1-

Baseline

Baseline

Baseline

Baseline[74.1; 78.5[

Adjustors#2-

Adjustors#2-

Adjustors#2-

Adjustors#1-

Baseline

Baseline

Baseline

Baseline[78.5; 82.9[

Adjustors#1-

Adjustors#1-

Adjustors#1-

Adjustors#1-

Baseline

Baseline

Baseline

Baseline[82.9; 91.6[

Baseline

Baseline

Baseline

Baseline

Baseline

Baseline

Baseline

Baseline[91.6; 95.9[

Baseline

Baseline

Baseline

Baseline

Adjustors#1+

Adjustors#1+

Adjustors#1+

Adjustors#1+

From 10% to 15%[95.9; 100.3[

Baseline

Baseline

Baseline

Baseline

Adjustors#1+

Adjustors#2+

Adjustors#2+

Adjustors#2+

From 15% to 20%[100.3;104.7[

Baseline

Baseline

Baseline

Baseline

Adjustors#1+

Adjustors#2+

Adjustors#3+

Adjustors#3+

Above 20%

[104.7; …[

Baseline

Baseline

Baseline

Baseline

Adjustors#1+

Adjustors#2+

Adjustors#3+

Adjustors#4+

From -20% to -15%

From -15% to -10%

From -5% to 5%

From 5% to 10%

1

From -10% to -5%

Test variable 1: 2027 Nominal GDP (in USDbn)

Below -20%

Note: (1) This variable would be assessed as the variation between the actual cumulated real GDP growth and the cumulated real GDP growth under the IMF baseline projections

4

INTERNATIONAL SOVEREIGN BONDS INDICATIVE DEBT TREATMENTPROPOSAL

Indicative terms of the B-Bonds and Adjustment Mechanisms – Upside Adjustments
Post-2027
Adjustments

Scenarios

No adjustment(reference)

Adjustors #1+

Adjustors #2+

Adjustors #3+

Adjustors #4+

Capital Adjustment

Amortization
adjustment

Coupon rate adjustment

B-Bonds

CapitalAdjustment
FactorNominal Value ofthe B-Bonds¹(in USDm)

From 2024 until
2027 (incl.)

From 2028 until
2032 (incl.)

From 2033 until
maturity

B-Bond 2036

100%

966

4.0%

4.0%

4.0%

Bullet; final maturity
in 2036

B-Bond 2037

100%

879

4.0%

4.0%

4.0%

Bullet; final maturity
in 2037

B-Bond 2038

100%

879

4.0%

4.0%

4.0%

Bullet; final maturity
in 2038

B-Bond 2036

120%

1,160

4.0%

4.0%

4.0%

B-Bond 2037

120%

1,054

4.0%

4.0%

4.0%

B-Bond 2038

120%

1,054

4.0%

4.0%

4.0%

B-Bond 2036

135%

1,305

4.0%

4.5%

6.5%

Similar to adjustors #1+

B-Bond 2037

135%

1,186

4.0%

4.5%

6.5%

Similar to adjustors #1+

B-Bond 2038

135%

1,186

4.0%

4.5%

6.5%

Similar to adjustors #1+

B-Bond 2036

150%

1,450

4.0%

5.5%

7.5%

Similar to adjustors #1+

B-Bond 2037

150%

1,318

4.0%

5.5%

7.5%

Similar to adjustors #1+

B-Bond 2038

150%

1,318

4.0%

5.5%

7.5%

Similar to adjustors #1+

B-Bond 2036

165%

1,594

4.0%

6.5%

9.0%

Similar to adjustors #1+

B-Bond 2037

165%

1,450

4.0%

6.5%

9.0%

Similar to adjustors #1+

B-Bond 2038

165%

1,450

4.0%

6.5%

9.0%

Similar to adjustors #1+

Notes: (1) Nominal Value of the B-Bonds after the dual one-time test, depending on the adjustors, (2) In % of B-Bonds nominal amount (yearly amortization)

3%² (2028-32), 7%(2033-35), 64% (2036)
3%² (2028-32), 7%(2033-35), 64% (2037)
3%² (2028-32), 7%(2033-35), 64% (2038)

5

INTERNATIONAL SOVEREIGN BONDS INDICATIVE DEBT TREATMENTPROPOSAL

Indicative terms of the B-Bonds and Adjustment Mechanisms – Downside Adjustments
Post-2027
Adjustments

Scenarios

No adjustment(reference)

Adjustors #1-

Adjustors #2-

Adjustors #3-

Adjustors #4-

Capital Adjustment

Amortization
adjustment

Coupon rate adjustment

B-Bonds

CapitalAdjustment
FactorNominal Value ofthe B-Bonds¹(in USDm)

From 2024 until
2027 (incl.)

From 2028 until
2032 (incl.)

From 2033 until
maturity

B-Bond 2036

100%

966

4.0%

4.0%

4.0%

Bullet; final maturity
in 2036

B-Bond 2037

100%

879

4.0%

4.0%

4.0%

Bullet; final maturity
in 2037

B-Bond 2038

100%

879

4.0%

4.0%

4.0%

Bullet; final maturity
in 2038

B-Bond 2036

75%

725

4.0%

2.5%

2.0%

No adjustment

B-Bond 2037

75%

659

4.0%

2.5%

2.0%

No adjustment

B-Bond 2038

75%

659

4.0%

2.5%

2.0%

No adjustment

B-Bond 2036

50%

483

4.0%

2.0%

1.0%

No adjustment

B-Bond 2037

50%

439

4.0%

2.0%

1.0%

No adjustment

B-Bond 2038

50%

439

4.0%

2.0%

1.0%

No adjustment

B-Bond 2036

25%

242

4.0%

2.0%

0.5%

No adjustment

B-Bond 2037

25%

220

4.0%

2.0%

0.5%

No adjustment

B-Bond 2038

25%

220

4.0%

2.0%

0.5%

No adjustment

B-Bond 2036

0%-

B-Bond 2037

0%-B-Bond 2038

0%-Note: (1) Nominal Value of the B-Bonds after the dual one-time test, depending on the adjustors

63.

Group’s April Proposal

Indicative term sheet for Macro-Linked Bonds (1/2)

Indicative terms of new bonds under an MLB structure1,2 (under IMF Baseline)

Instrument type

Bonds
instalments

Past Due Interest2

Plain Vanilla #13

Notional amountat exchange date
(US$m)

Coupon rate
Notional at end
2027 (US$m)

Up to 2027 (cash) 2028-2032 (cash)

2033 onwards(cash)◼

28% haircut on the nominal amount ofexisting bonds◼

No haircut on PDIs◼

Consent fee representing c.1.8% oforiginal principal claim (excl. PDIs,
US$ 225m) to be paid upfront

1,678
2024

336

n.a.

4.00%

n.a.

n.a.

2025

336

n.a.

4.00%

n.a.

n.a.

2026

336

n.a.

4.00%

n.a.

n.a.

2027

336

n.a.

4.00%

n.a.

n.a.

2028

336

n.a.

4.00%

n.a.

n.a.

New bonds instalments

Key evolutions of the MLB structure :
◼

9,036
2029

650

650

3.75%

4.00%

-

2030

650

650

3.75%

4.00%

-

2031

900

900

4.00%

4.25%

-

2032

900

900

4.00%

4.25%

-

2033

900

900

4.00%

4.25%

8.75%

2034

800

800

4.25%

6.00%

9.25%

MLB #1MLB #2

Plain Vanilla #23
MLB #3MLB #4

2035

800

800

4.25%

6.00%

9.25%

2036

1,250

1,250

4.25%

4.50%

9.50%

2037

1,093

1,093

4.25%

4.50%

9.75%

2038

1,093

1,093

4.25%

4.50%

9.75%

A “shift” in the structure of the MLB,
which is now centered on the IMF
baseline,□ Upside (downside) adjustments
triggered in case of GDP
overperformance (underperformance)in comparison with the IMF baseline◼

Inclusion of an additional downside
threshold below the IMF baseline◼

Inclusion of a new vanilla bond◼

Less instalments (final instalment in2038 vs. 2040 previously)

Note 1. Terms calibrated under a DSA based on public debt stock at end-2023
Note 2. “PDIs” capitalized into a new instrument. PDIs based on estimated past due interest accumulated at end Dec-2023, i.e. $1,678m (to be updated at the time of the debt exchange)
Note 3. New vanilla bond could potentially be structured (in whole or in part) as a “Governance-Linked Bond”

3

Indicative term sheet for Macro-Linked Bonds (2/2)
Overview of MLB adjustment mechanisms
Overview of GDP thresholds under the updated MLB structure

Adjustements

Baseline

US$ nominal GDP(avg. 2025-2027, billion)

Weighted incremental
principal reinstatement(haircut if negative)1

2028 principal (as a % of original
claim excluding PDIs)

Average coupon post 2028

Alternative baseline (MLB)

96.3

28.8%

92.7%

8.5%

GDP threshold #1

93.9

24.7%

89.8%

8.1%

GDP threshold #2

90.1

20.6%

86.8%

7.4%

GDP threshold #3

86.3

8.2%

77.9%

6.8%

IMF baseline

84.2

-

72.0%

6.4%

Threshold below IMF baseline #1

80.5(18.9%)

58.4%

6.0%

Threshold below IMF baseline #2

77.6(37.0%)

45.3%

5.8%

Note 1. Triggered by the adjustment (as a % of 2027 principal)

4

4.

Governance Linked Bond

Overview of GLB key proposed features (1/2)
 Including an ESG component to the debt treatment agreement, focusing on governance aspects, and mimicking the structure of SustainabilityLinked bonds (applicable to non-MLB instruments, with target size of $500m to $1bn)
 Governance-linked bond as an efficient incentive for the authorities to improve governance and reduce corruption vulnerability, benefitting
both the country and bondholders
 Coupon step down structure, with single adjustment triggered in case all indicators meet performance targets at a specific date

 Final structure to be refined in good faith and in close coordination with the Sri Lankan authorities

1
Selected performanceindicators◼

Set of transparent and easily measurable governance criteria◼

GLB adjustment based on [2] Key Performance Indicators (KPIs), including□ 1 quantitative target: government tax revenue-to-GDP□ 1 qualitative target: based on IMF program commitments, to be discussed (see next page)2
Measurement date◼

Aligned on MLB: H1-2028, based on performance in [2026 or 2027]

Adjustment date◼

Downward coupon adjustment potentially triggered in [June] 2028 if both targets met

Test & coupon adjustment
mechanism◼

[50] bps downward coupon adjustment if both targets are met

External party assessment◼

External review by independent entity (Moody’s ESG Solutions, Sustainalytics, …)

3

4

5

1

Overview of GLB key proposed features (2/2)
GLB structured based on 2 Key Performance Indicators (KPIs)
 The coupon step-down would be activated if all of [two] KPIs are successfully met, including one “quantitative” KPI and one “qualitative”
reform target

1

KPI #1

 Tax revenue-to-GDP ratio for [2026] or [2027]¹□ For reference, IMF program tax revenue-to-GDP target: 14.0% in 2026 and 14.1% in 2027

Quantitative2

 Selected reforms envisaged under the current IMF program (“Structural Benchmarks”), in particular:□ Publication of public procurement contracts: publish online semi-annually all public procurement contracts aboveRs. 1 billion, along with comprehensive information in a searchable format on contract award winners, is confirmed by
IMF reviews as met with at least 4 satisfactory semi-annual updates after the first date of publication, being confirmed
as met by IMF reviews by end 2026.
KPI #2□ Publication of information on tax exemptions: publish online semi-annually a list of all firms receiving tax
exemptions through various legal provisions, alongside the estimation of the value of the tax exemption, is confirmed by
IMF reviews as met with at least 4 semi-annual updates after the first date of publication, being confirmed as met by
IMF reviews by end 2026.

Qualitative◼

The Sri Lanka Authorities may also suggest their own governance targets, along with their associatedmeasurement and verification method, to be subsequently discussed with the Steering Committee, so as to define the
GLB mutually, in good faithNote 1 To be discussed, considering the final review of the current IMF program is scheduled in March 2027

2

This announcement does not constitute an offer of securities for sale in the United States. This announcement does notconstitute an offer of securities for sale, or the solicitation of an offer to buy any securities, in any state or other jurisdiction inwhich any offer, solicitation or sale (if made) would be unlawful. Any person considering making an investment decision
relating to any securities must inform itself independently based solely on an offering memorandum to be provided to eligible
investors in the future in connection with any such securities before taking any such investment decision.
No offer of any kind is being made to any beneficial owner of securities located in a jurisdiction where the offer would not be
permitted by law.
Forward-Looking Statements
All statements in this announcement, other than statements of historical fact, are forward-looking statements. These statements
are based on expectations and assumptions on the date of this announcement and are subject to numerous risks and uncertainties
which could cause actual results to differ materially from those described in the forward-looking statements. Risks anduncertainties include, but are not limited to, market conditions and factors over which Sri Lanka has no control. Sri Lanka
assumes no obligation to update these forward-looking statements and does not intend to do so, unless otherwise required bylaw.

10284504091-v1-3-

70-41037223