OCC Approves SriLankan Airlines Debt Repayment Plan

Sri Lanka’s Official Creditor Committee (OCC) has approved the government’s proposed repayment structure for the defaulted SriLankan Airlines bond, marking a key milestone in the country’s broader debt restructuring process.

Treasury Secretary Harshana Suriyapperuma said the OCC had formally raised no objections to the settlement plan, which includes a 15 percent haircut for bondholders and a mix of cash repayment and exchange into a 4.00 percent amortising Sri Lankan government bond maturing between 2026 and 2028.

SriLankan Airlines had issued a USD 175 million sovereign-guaranteed bond to raise cash, but the obligation fell on the state after the airline continued to incur losses. The restructuring terms have also been shared with the International Monetary Fund to ensure alignment with debt sustainability targets.

Officials said over 90 percent of Sri Lanka’s restructured debt by value has now been agreed, with remaining steps expected to be completed shortly.

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