There is a disagreement between the SL government and ISB investors regarding the proposed haircuts for past-due interest and principal amounts. The government seeks a 20% reduction for past due interest and proposes a 30% reduction for principal amounts, while investors are considering a 28% reduction for principal amounts but have not agreed to the 20% reduction for past due interest.
Regarding the annualized average interest cost, until 2028, the government's proposal suggests a rate of 4.2%, slightly higher than the 4.0% rate proposed by investors. However, from 2028 onwards, the average interest rate increased to 6.4% under the investor proposal compared to 5.4% under the government's proposal.
These differences highlight the ongoing negotiations to find a balanced solution that addresses the financial obligations of both parties while ensuring a sustainable approach to debt restructuring.