Sri Lanka ETI directors’ assets being sold to repay depositors: Central Bank

ECONOMYNEXT – Assets of directors of ETI Finance Ltd. (ETIF) are being sold to repay depositors, with 20 percent of deposits already repaid by selling the failed finance company’s subsidiaries and investment properties, Sri Lanka’s Central Bank said.

“(The central bank) has also initiated several legal actions against the directors of ETIF to seize personal assets of the directors and transfer those proceeds to ETIF,” a statement from the regulator’s Department of Supervision of Non-Bank Financial Institutions said.

“Accordingly, (the central bank) wishes to emphasise that ETIF would be paying to its depositors a total amount in excess of 10 billion rupees without any financial contribution from the Government of Sri Lanka, Central Bank of Sri Lanka or the Sri Lanka Deposit Insurance and Liquidity Support Scheme.”

The Central Bank has taken a number of measures on ETI Finance to address various irregularities taken place since 2011, including severe liquidity constraints faced by the company during the latter part of 2017.

The sale of subsidiary and sub-subsidiary companies and investment properties of ETIF had raised 70 million US dollars.

These funds, equivalent to 11 billion rupees, have been already used to repay 20 percent of the deposits and accrued interest liabilities of ETIF.

The company is currently processing a further 10 percent repayment to the depositors.

Regulatory measures taken on the company resulted in the directors of ETIF transferring their personal assets including EAP Broadcasting Co Ltd and Swarnamahal Jewellers Ltd., the statement said.

The directors of ETIF have given an undertaking to transfer additional personal assets to cover the negative net worth of the company, it said.
(COLOMBO, May 02, 2019-SB)





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