Seylan Bank PLC’s Islamic Banking Unit (SBK IBU) has been awarded the prestigious “Islamic Finance Deal of the Year” at the SLIBFI Awards 2025, in recognition of its innovative financing of a landmark renewable energy project in Sri Lanka’s Eastern Province. The transaction was initiated with the support of Seylan Corporate Banking – Project Finance, who led the proposal initiation, while SBK IBU managed the Islamic structuring and documentation.
The accolade celebrates SBK IBU’s sole financing of a Diminishing Musharaka Facility to Sooryashakthi (Pvt) Ltd, a Special Purpose Vehicle (SPV) created to develop a 10 MW ground-mounted solar power plant in Vavunathivu, Batticaloa District. The solar project, awarded through a competitive bidding process under the Sooryabala Sangramaya Scheme, forms part of Sri Lanka’s broader renewable energy vision for 2030 and beyond.
The total project cost exceeds LKR 2.3 billion, underscoring the magnitude and strategic importance of this infrastructure development. Sooryashakthi (Pvt) Ltd is a wholly owned subsidiary of Solar Universe (Pvt) Ltd, a joint venture between Vidullanka PLC and Windforce PLC. Furthermore, Solar Universe (Pvt) Ltd is presently overseeing Phase I of the solar initiative financed by Seylan’s Islamic Banking Unit.
This transaction is a landmark moment not just for renewable energy, but also for Islamic Banking and Finance (IBF) in Sri Lanka. Despite its relatively young 20-year history, the IBF sector has proven its ability to support large-scale infrastructure projects using Sharia-compliant structures. The Diminishing Musharaka structure employed in this deal demonstrates the depth and flexibility of Islamic finance to deliver impactful outcomes in the country’s development journey.
The solar power plant is expected to contribute 10 MW to the national grid, generating 18.25 GWh annually. This output translates to an annual savings of approximately 5 billion litres of oil and a reduction of 12,709 metric tons of CO₂ emissions, reinforcing Sri Lanka’s commitment to environmental sustainability and carbon neutrality by 2050.
“This award underscores our steadfast commitment to sustainable development and innovative financial solutions. Having also financed Phase I of this initiative, we are especially proud to support projects that advance national energy goals while showcasing the unique value that Islamic finance brings to the table,” said Sameer Mohamed, Head of Islamic Banking at Seylan Bank’s Islamic Banking Unit.
The project further spotlights local engineering and project execution capabilities, as well as the growing appetite for renewable energy investments that align with both commercial and environmental goals. It also sets a compelling precedent for other Islamic Financial Institutions (IFIs) to explore and enter the renewable energy financing space.
Since its launch in August 2018, SBK IBU has played a pioneering role in Islamic renewable energy finance, supporting numerous impactful renewable energy projects both within Sri Lanka and overseas.
