GOSL asks US court to dismiss case filed by Hamilton Reserve Bank over default

The Sri Lankan government has asked a US judge to dismiss the case filed by Hamilton Reserve Bank for defaulting on bonds, the financial news agency Bloomberg reported.

The government had requested that the case in New York be dismissed over the country reaching debt default, stating that the case brought by one bank is an “apparent attempt to gain leverage over a nation in crisis and jump ahead of other foreign creditors.”

Hamilton Reserve Bank, based in the Caribbean islands of St. Kitts & Nevis, filed legal action citing the country’s default on a $1 billion sovereign bond.

The 5.875% interest International Sovereign Bonds were due for payment two months ago on July 25, 2022.

When contacted by News 1st, the Finance Ministry confirmed that arguments were presented with regard to the relevant case.

According to court documents seen by News 1st, Hamilton Reserve Bank has charged that under the terms of the Bonds, Sri Lanka owes it a total of US$257,539,331.25. This is comprised of US$250,190,000 in principal and US$7,349,331.25 in interest.

Hamilton Reserve Bank previously alleged that Sri Lanka’s default was being orchestrated by officials at the highest levels of its Government, and also charged that the Rajapaksa family was responsible.