3rd Sep 2018 16:55
LONDON (Alliance News) - Templeton Emerging Markets Investment Trust PLC said Monday it has amended its revolving loan facility with the London branch of Bank Of Nova Scotia.
The loan amount has been increased to GBP220 million from GBP150 million and remains Templeton's only debt.
The facility can be drawn in pounds, US dollars, and Chinese renminbi. The maximum quantity of Chinese renminbi that can be drawn from the loan facility has been raised to the equivalent of GBP44 million from the equivalent of GBP30 million.
Based on the company's net asset value last Friday, fulling drawing down the total GBP220 million loan would bring the company's gross gearing to 10%. This is the maximum gearing allowed under Templeton's investment policy.
"While the board and the investment manager recognise that gearing increases volatility, after careful consideration, we have concluded that it may be in shareholders' interests to increase the company's borrowing facility at a time when the long-term outlook for emerging markets remains positive and interest rates are low. The manager has been granted discretion by the board to draw down the debt as investment opportunities arise, subject to overall supervision by the board," said Templeton Chairman Paul Manduca
Shares in Templeton Emerging Markets closed up 0.4% at 709.069 pence on Monday.
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Templeton Emerging Markets