The bond will be subordinated to deposits, meaning they will rank lower in repayments in case of liquidation.
According to a prospectus, the bank will sell 1.5 billion rupees in bonds with the option for a further 1.0 billion rupees if there is more demand.
Sampath Bank is offering bonds that will pay 16.5 percent at the end of each year, 15.0 percent interest paid every month (16.08 percent annual effective rate) and floating rate bonds.
The floating rate debentures will pay 2.0 percent above the gross (before the withholding tax deduction) 6-month Treasury bill yield.
In Sri Lanka a 10 percent tax is levied on interest on bonds and deposits at source.
The bonds are coming to the market at a time when Sri Lanka is emerging from a balance of payments crisis and interest rates are tipped to fall if the state manages not to deficit spend excessively.