Sri Lankan financial firms raise 12.5 billion rupees of new capital

ECONOMYNEXT – Nine financial firms in Sri Lanka have raised 12.6 billion rupees to shore up their capital and also offered consolidation plans, the central bank said.

Sarvodaya Development Finance PLC, Dialog Finance PLC, Asia Asset Finance PLC, Lanka Credit and Business Finance PLC, People’s Merchant Finance PLC, Softlogic Finance PLC, Merchant Bank of Sri Lanka & Finance PLC, UB Finance Co Ltd and Richard Pieris Finance Ltd raised 12.5 billion rupees.

12 other companies are being consolidated.

The full statement is reproduced below:

Accelerated Non-Banking Financial Institutions Consolidation Master Plan

Under the Master Plan for the Consolidation of Non-Banking Financial Institutions (the Master Plan) implemented by the Central Bank of Sri Lanka (CBSL), the following 9 companies have already introduced new capital of Rs 12.56 billion to meet regulatory capital requirements: Sarvodaya Development Finance PLC, Dialog Finance PLC, Asia Asset Finance PLC, Lanka Credit and Business Finance PLC, People’s Merchant Finance PLC, Softlogic Finance PLC, Merchant Bank of Sri Lanka & Finance PLC, UB Finance Co Ltd and Richard Pieris Finance Ltd.

In addition, 12 companies submitted their acquisition/consolidation plans to CBSL and obtained the relevant preliminary approvals as follows:

1. Assetline Leasing Co Ltd – acquisition of Kanrich Finance Ltd’s finance business license and settlement of its deposits.

2. LB Finance PLC – acquisition and subsequent merger of Multi Finance PLC.

3. SMB Leasing PLC – acquisition of Swarnamahal Financial Services PLC’s finance business license and settlement of its deposits.

4. Commercial Leasing & Finance PLC – acquisition and subsequent merger of Sinhaputhra Finance PLC.

5. HNB Finance PLC – acquisition and subsequent merger of Prime Finance PLC.

6. LOLC Finance PLC – merger of Commercial Leasing & Finance PLC.

As a result of the above developments, the non-banking financial institutions sector has seen significant improvement in compliance with regulatory capital requirements and recorded the lowest levels of non-compliance in recent times.

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