OCC agrees to SriLankan Airlines’ debt restructuring proposal: Treasury Sec

The Official Credit Committee (OCC), which is involved in Sri Lanka’s debt restructuring efforts, has agreed to the government’s proposal regarding the repayment of state-owned SriLankan Airlines’ debt, according to Treasury Secretary Harshana Suriyapperuma.

SriLankan Airlines had previously issued a sovereign-guaranteed bond worth 175 million US dollars to raise funds after experiencing losses. These financial difficulties followed the removal of Emirates as the managing shareholder by then-President Mahinda Rajapaksa.

Last month, SriLankan Airlines notified the market that, pending OCC approval, it had restructured its defaulted bonds with a 15 percent haircut. Under the new arrangement, bondholders would receive a combination of cash and a 4.00 percent amortizing government bond.

“We are very grateful and happy to inform that the OCC has formally conveyed their position of no objection in order to support Sri Lanka, particularly considering the difficult situation Sri Lanka is in right now,” Suriyapperuma said in a recorded video message distributed to the media.

He added, “The OCC has indicated to us that they have no objection to Sri Lanka proceeding on the basis that we have chosen in terms of the settlement arrangements that we have shared with them.”

Suriyapperuma described the OCC’s approval as an important milestone for Sri Lanka as it works to finalize the remaining agreements related to debt restructuring. He noted that approximately 90 percent of the restructured values have been achieved so far.

He also stated that Sri Lanka is in ongoing discussions with other governments and stakeholders to explore further solutions and finalize outstanding debts.

“There are a few more steps in the process. We believe these are procedural and, with the support of all parties involved, we should be able to complete them within a short period of time,” he said.

Last month, SriLankan Airlines indicated that the parties expect to implement the debt transaction by the end of the year, following OCC approval.

(Colombo/December 19, 2025)