Sri Lanka’s Swarnamahal Financial told to pay 10-pct of deposit liabilities

ECONOMYNEXT – Sri Lanka’s central bank said it had asked Swarnamahal Financial Services PLC (SFSP) to pay 10 percent of its deposit liabilities starting Tuesday and asked depositors to be patient until the firm is restructured.

A statement from the regulator’s Department of Supervision of Non-Bank Financial Institutions said details of the payment plan will be informed to depositors by SFSP shortly.

It said the Monetary Board of the Central Bank, having considered the requests of the depositors, instructed SFSP to pay urgently 10 percent of deposit liabilities of SFSP commencing from 10.07.2018.

The central bank said it “wishes to request all depositors to be patient until the business activities of SFSP are restructured and to cooperate with the Central Bank appointed management panel for the implementation of such activities.”

The central bank in January 2018 took over Swarnamahal Financial Services and ETI Finance Ltd., part of the family-held EAP Group of Companies, after they ran into liquidity problems and were unable to repay depositors.

ETI Finance had deposits of 33.5 billion rupees from about 33,000 depositors and Swarnamahal Financial Services had 2.5 billion rupees of deposits from 2,300 depositors.
(COLOMBO, July 10, 2018)

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