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Sri Lanka’s Bank of Ceylon plans Rs10bn venture fund

ECONOMYNEXT – Sri Lanka’s state-run Bank of Ceylon is planning a 10 billion rupees venture capital fund after seeing high balance sheet growth in 2020, with group gross assets growing 22.8 percent to 3.0 trillion rupees, officials said.

Bank of Ceylon Chairman Kanchana Ratwatte said a 10 billion rupee venture capital fund is being planned which will target start-ups, export oriented companies, import substitution companies and IT sector businesses. It was still under an approval process.

In 2020 the Bank of Ceylon group had grown its loan book 27.7 percent to 2.0 trillion rupees and its deposit 23.1 percent to 2.49 billion rupees. At standalone bank level loans grew 28 percent to 1.98 trillion rupees and deposits 23.4 percent to 2.47 trillion rupees.

Sri Lanka’s sovereign downgrade had brought challenges to the bank in letters of credit and also foreign exchange credit to the government, which required higher provisions.

“There is a formula where when the country rating gets downgraded, we have to increase our provisioning, especially on government borrowings in US dollars,” Russel Fonseka, Chief Financial Officer of Bank of Ceylon said.

In the year to December group profits fell 28 percent to 16.8 billion rupees.

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Last year the Bank of Ceylon struck deal with the China Development Bank for a 140 million dollar credit.

“Even in these challenging times, Bank of Ceylon was able to obtain a loan of 140 million US dollars from the China Development Bank of which the second half will be obtained within this year, General Manager D P K Gunasekara said.

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The bank had given 39.1 billion rupees under a ‘Saubagya’ branded credit scheme for Coronavirus hit firms and set up a business revival unit for underperforming and non-performing business following pandemic hit.

The business revival unit has funded nine large scale businesses by utilizing 25 billion rupees worth of facilities, officials said.

General Manager Gunasekara also said IT infrastructure was enhanced to cater to Covid-19 crisis.

“The bank has conducted 5.2 billion daily transitions through the ATM, CDM, CRM and other online and mobile banking facilities,” Gunasekara said.

“We saw a growth of 109 percent in transactions and an 80 percent expansion in business volume. We recorded 10,000 e-commerce transactions daily.

The bank was also driving up QR code transactions.

“BOC is also the largest acquirer and issuer of the Lanka QR transactions,” Gunesekera said.

We have completed more than 111 million Lanka QR transactions within the past two months.:

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