Nakath Vasi Avurudu sale now on at Abans showrooms
promises to give their customers value for money with
discounts of upto a third of the value slashed from the
original selling price.
that's not all, customers can also enjoy many other
benefits like "Hatrick Offer," "Twenty-20 Offer,"
"Free Hit Offer" and a chance to be one of 10 lucky
customers to win free air tickets to
for the World Twenty-20 Cricket Tournament in June 2009
with accommodation and match tickets to cheer our
what's more, Abans "No Poli-More Jolly" interest free
instalment terms are available to customers to help them
shop to their hearts content without worrying about
celebrate LG's sponsorship of the World Twenty-20
Cricket, Abans, the sole agent for LG products in Sri
Lanka, launched the Abans LG Twenty-20 Win Win promotion
which coincides with Abans' Naketh Vasi sale.
customer who buys any product for Rs.5,000 or over will
be entitled to a chance to win an air ticket to England
with accommodation and match tickets for World
Twenty-20. A total of 10 air tickets will be on offer
for those who shop at Abans upto April 15, 2009.
offer you the opportunity of being a multiple winner!
you buy a product from Abans you are not only assured
that you have bought a world class product with a
guarantee of quality and after-sales-service, but also
excellent value for your money and the chance of a
lifetime to visit England in Summer and watch our world
class cricketers participate in a world class
your nearest Abans Showroom to view the wide range of
LG's innovative energy saving appliances and guaranteed
quality appliances from the world's best brands. The
widest selection of fridges, televisions, washing
machines, air conditioners, cookers, ovens, vacuum
cleaners, floor polishers and more. Also affordable,
fuel-saving scooters and motorcycles from Jialing, LML
and Piaggio, with advanced Italian design and Honda
get only 60-80% of capital outstanding
Depositors in two F&G cos. to forego interest
Investors in two troubled Finance & Guarantee (F&G)
Group companies will not get any interest payments on
their deposits, reporters were told at a press
conference on Tuesday.
two companies are F&G Real Estate Co., Ltd., (RECL) and
F&G Property Developers Ltd. (FPDL), two unregulated
finance companies with a total deposit base of Rs. 8.1
Ratnayake, Chairman of the majority government
controlled Merchant Bank of Sri Lanka (MBSL), appointed
by the Central Bank (CB) to manage the affairs of F&G
Group to prevent it from total collapse told reporters
on Tuesday that a number of depositors from such
companies used to collect their interest on a monthly
Further, depositors in these two companies with deposits
above Rs. 50,000 in value will only get 60-80% of their
capital, while only those with deposits of Rs. 50,000
and under will get the full value of their capital.
F&G Group, a Ceylinco company, is facing a liquidity
crunch because of a run on its deposits after the
collapse of its associate company Golden Key last year,
wiping out some Rs. 26 billion in deposits value in a
financial scam involving the latter company. The F&G
Group comprises three companies with a total deposit
base of Rs. 11.3 billion. They are F&G Ltd. (F&G), a
registered finance company (RFC): with a Rs. 3.2 billion
deposit base, RECL (Rs. 3.5 billion) and FPDL (Rs. 4.6
Group has a 7,000 strong depositor base. The individual
breakdown of depositors in each of these three companies
was not immediately available.
bigger depositor value bases in the two unregulated F&G
companies was because they were offering a higher return
on deposits," Ratnayake said.
of those companies were paying an interest rate as high
as 40% on deposits, he added.
it's learnt that RECL and FPDL will go into liquidation
after paying off its liabilities, the parent company,
F&G, an RFC, will continue as a going concern.
Meanwhile revised depositor payment schemes offered for
F&G include, in the event of deposit renewals with
accrued interest, say for a further one year period,
interest payable on maturity at a ceiling of 20%.
payment scheme in regard to F&G, a regulated finance
company includes, as per a company statement, at
maturity, if the depositor wishes to take the interest
but keep the capital, say for another year, interest
payable is 12% while the difference (as per the interest
displayed on the certificate) will be paid after a year.
Payment schemes offered for F&G also include, as per the
statement: Renewal of deposits for a year at 20% on
maturity or at 17% on a monthly basis after
making/releasing interest payment for arrears from the
date of maturity till the date of renewal at 12%.
Exchange of property for maturity value at the
discretion of the depositor.
However if "some" depositors insist on immediate payment
of deposit value, for deposits on maturity interest of
under a year, 90% of capital will be paid within a six
month period as full and final settlement, and in regard
to monthly interest terms of under a year, then 75% of
the capital will be paid as full payment within six
Payment of interest on future maturities will be at the
rate of 12% with a promissory note to the value of the
difference, with capital amount to be renewed for a
further one year period.
Depositors are also given the option to get property in
exchange for the maturity value of deposits.
Interest for existing depositors in monthly category
will be paid their monthly interest at the rate of 12%
until the deposit is matured and separate promissory
notes will be given for the difference in interest (rate
said in the certificate less 12%). Each promissory note
will be paid after a year.
Capital amount on deposits on maturity will be renewed
on the following basis: 50% of capital amount on
maturity interest basis and balance on monthly interest
basis. Monthly interest is paid at the rate of 17% and
maturity rate, at the rate of 20%. These customers are
also given the option to get property in lieu of
deposits even before the period of maturity.
company is able to obtain a loan of Rs. 500 million from
the CB, then those promissory notes will be settled
Meanwhile, payment scheme for RECL depositors, deposits
upto Rs. 50,000: Payment in full.
deposits beyond that value will be paid 80% of the value
at maturity, and monthly category, 70% of the value.
of deposits of between Rs. 50,001-250,000; in regard to
maturity deposits, Rs. 6,667 monthly (instalments) and
in the monthly category, in monthly instalments to the
value of Rs. 5,833 each.
Between Rs. 250,001-500,000; in regard to maturity
deposits, Rs. 8,333 monthly and in the monthly category,
in monthly instalments to the value of Rs. 7,292 each.
And Rs.500,001 and above-properties in lieu of deposits.
Payment scheme for depositors of FPDL: Upto Rs. 50,000:
60% in one instalment. Between Rs. 50,001-100,000: 60%
payment in maximum of 12 monthly instalments of Rs.
5,000 each and between Rs. 100,001-Rs. 250,000; Payment
to the 60% of value only in a maximum of 24 monthly
instalments of Rs. 4,167 each, with the balance dues to
be paid from the sale of properties belonging to the
250,001 and above, assignment of properties and part
payment proportionate to the deposit value at the time
of disposing of assets.
Initially transferring of properties are limited to 60%
of the deposit liability. Letter of comfort to be issued
for the balance capital amount which will be settled
after a year if the company successfully divests its
long term investment in Fingara Town and Country Club
(book value of Rs. one billion) and
Market looks for rate direction
Treasury (T) Bills and Bond trading in the secondary
market was quiet on Friday, with investors adopting a
"wait and see" attitude, awaiting the outcome of this
week's T Bill auction before making their next move.
rates at last week's auction fell, with the benchmark
364 day Bill falling by 33 basis points. "If that
maturity falls by another 25 basis points (bps) at this
week's auction that may give a signal to the market that
rates are on a downward trend, possibly leading to a
flurry of activity," market sources said.
indications however are that rates are on a downward
spiral, with victory in the war seemingly at hand and
the possibility of the government obtaining a US$ 1.9
billion IMF loan equally strong, they said.
exporters encashing their dollars in lieu of the
expected IMF facility that gave a thrust to the rupee,
which saw the greenback depreciate by 20 Sri Lanka cents
against the local currency at Friday's trading.
dollar which opened on Friday morning at Rs. 114/10/20
in two way quotes, strengthened to Rs. 113/90/114 as a
result," the sources said. Another reason for the
strengthening of the rupee is that the government has
stayed away from the foreign exchange market since March
9, thereby easing pressure on the local currency, they
However, government borrowing was visible in the rupee
market, with the market, on a net overnight basis being
short by Rs. 6.6 billion on Friday, the sources added.
Promoting sterilised milk
promoting liquid pasteurized milk in the country may be
a problem due to expensive infrastructure investments
required, particularly because such milk goes bad very
quickly, the alternative is to promote sterilized liquid
milk that can be kept bereft of refrigeration for weeks,
a manager said.
De Mel, General Manager Unical (Ceylon) Ltd., a company
which is into veterinary pharmaceuticals however told
The Sunday Leader that because the powdered milk lobby
in the country was powerful, government's efforts to
promote liquid milk in the country will not be an easy
estimated that 80% of the milk consumed in the country
comes in the form of imported powdered milk and only 20%
in the form of liquid milk.
multinational company (MNC) converted a liquid milk
plant here to process coconut milk, whilst at the same
time indulging in buying liquid milk locally from the
farmer, and converting the same into powdered milk,
alleged De Mel.
Another MNC which also has a strong presence in the
powdered milk market here ran a joint venture in China
to promote liquid milk consumption there, but was
cheated by its local partner who added the banned
melamine substance to strengthen that milk's protein
content, alleged De Mel.
however said that there are checks and balances in place
to detect the addition of such harmful substances to
Colombo Stock Exchange listing rules have been revised
subsequent to obtaining comments from stakeholders.
revised Listing Rules will be effective from April 1,
Changes arising from the new Companies Act have been
incorporated in the new rules.
name "Second Board" has been changed to "Diri Savi
Board" in the new rules for listing of shares. The
eligibility criteria to list equity and debentures of a
company have been revised.
rules have been incorporated to list units of closed-end
funds, scrip dividends, re-purchase of shares,
redemptions, minority buyouts and the further issue of
shares by a listed entity through public subscription.
Rules relating to the further issue of securities, such
as Rights issues, Capitalization of reserves, Share
Swaps and Warrants have also been revised.
current requirement of dispatching interim financial
statements to all security holders or publishing in the
newspaper has been removed. This will be available on
the CSE website. Listed companies have been given the
option of forwarding annual reports to security holders
in the form of CD-ROMs.
good for the Government to speedily veto a Supreme Court
(SC) ruling on the grounds that it would affect
Government revenue, but not good enough to take punitive
action to immediately stop the operation of illegal
finance companies despite the fact that the voter or the
public having had lost an amount totalling Rs. 41
billion in the space of a few months by investing their
monies in only three such scam operations.
appears to know how many more of such illegal
operations, run by seemingly goody goodies, generous
with public money and hob knobbing with the powers that
be, like the smiling and cherubic Lalth Kotelawala, now
in remand after the Rs. 26 billion Golden Key scandal,
are still up and about, milking the guileless public of
their hard earned savings, by offering them the carrot
of a higher return.
Government needs to move fast, in the same speed as it
did when it vetoed the SC order to lower petroleum
prices commensurate with falling global prices that
sought to give the suffering consumer some relief, on
the grounds that it will hurt State revenue. In the
same vein the Cabinet of Ministers led by the President
should immediately put a stop to the operation of such
illegal deposit taking institutions on a Cabinet
that same speed is sadly missing when it comes to taking
action to prevent several more scandals similar to the
Sakvithi and Golden Key scams from taking place that has
left several thousands of depositors destitute overnight
as a result.
that the government simply doesn't care about the plight
of the innocent depositor?
26 billion Golden Key scam took place in November 2008,
the Rs. five billion Sakvithi scam a few months earlier
and the exposure of the Danduwan Mudalali scam in the
South, almost at the same time, with the latter scam
valued at Rs. 10 billion.
even after a lapse of four months since the Golden Key
scandal, the Government and the regulator-the Central
Bank (CB) appear to be dragging their feet in banning
this lethargy where Rs. 41 billion of public money was
swallowed up by only three illegal institutions in a
space of a few months considered too small, the cause
for this indifference? And their knock on effect on
other financial institutions, both regulated and
unregulated, of no consequence, despite the numerous
press conferences held by the CB to the contrary, the
reason for of this nonchalance?
are the authorities waiting for the loss of another Rs.
41 billion in public money through the operation of such
illegal schemes, probably this year, before waking up,
like Rip Wan Winkle, to take punitive action against
it due to crony capitalism, the plague of Third World
nations such as Sri Lanka, the cause for this
indifference? There are so many unanswered questions,
and the public have the right to know the reason why?
one, neither the Government nor the CB appears to be
accountable for the proliferation of such illegal
deposit taking schemes. The Government, the Cabinet of
Ministers and CB officers need to be aware that they are
paid and sustained by tax payers' monies, monies paid by
such people who have been defrauded, and it's their
bounden duty, other than educating the public about the
danger in investing in such illegal schemes to put a
stop to such operations and safeguard those monies, so
as to prevent any untoward socio-economic consequences.
Merchant Bank of Sri Lanka Chairman Janaka Ratnayake
told reporters on Tuesday (March 17), the spawning of
illegal finance companies took place after the opening
of the economy 32 years ago in 1977.
then people have had got their fingers burnt by
depositing their hard earned savings in such illegal
schemes because of the higher rate of return those
institutions promise over that of registered financial
institutions. And action is being taken only after the
horse has bolted.
Governor Ajith Nivard Cabraal says that they are still
in the process of finalizing or enacting the necessary
laws to prevent the operation of such illegal schemes.
necessary legislation against the operation of pyramid
schemes was however passed quickly.
that there are a bunch of powerful and influential
persons closely connected to the powers that be, behind
the operation of such illegal schemes that prevents the
CB from taking action against such miscreants?
Lanka does not have a culture (unlike neighbouring
India) of heads of institutions and ministries resigning
on a matter of principle.
reporter can however recall of only one such incident
here, way back in the early 1980s, of a public officer
resigning from office due to the obstruction to his
duties by a senior cabinet minister of that time.
officer who served as the general manager of the then
State owned Ceylon Hotels Corporation (CHC) effected a
transfer scheme for CHC rest house keepers. CHC at that
time functioned under the Minister of State. The State
Minister of the day summoned that officer and gave him
instructions not to transfer a particular rest house
keeper on the grounds that that was an order from
another senior cabinet minister.
officer said that he cannot make exceptions and
submitted his resignation on a matter of principle.
Regrettably, the country may have now descended into an
era of bootlickers and hangers on who only believe in
clinging on to office at any cost regardless of
principles, with the public having to pay the ultimate
price for the sins of omission and commission that
thereby continue unchecked, committed by the powers that
announced the launch of a campaign to save paper and
help reduce felling of trees in a bid to encourage its
customers to migrate from paper statements to
campaign which is now on will continue to reward
customers till April 20, 2009, once a customer registers
through the Bank's Personal Internet Banking service.
promotion will reward a total of 25 winners, with five
grand prizes of two night stays on double board basis at
Heritance Kandalama. The prizes comprise a free
excursion to the Eco Park. Ipods and pen drives will be
awarded as consolation prizes to 20 other winners.
was one of the first banks in the country to launch the
epaper facility, in 2003 for its personal banking
customers and consequently the facility was made
available to credit card customers in December 2007.
and Retail Distribution Head Nadeesha Senaratne said, "HSBC
is today delivering on its promise to offer top quality
service and innovative products. You will now be able to
view your statement from the comfort of your living
room, office or holiday resort - from anywhere at
anytime. Our customers will be able to access their
statement immediately as it is sent, through an email
notification to advice that the statement is ready for
viewing which will make it easier for customers to keep
abreast of their account activity."
estatement is another initiative by HSBC to offer
customers the flexibility and convenience of banking.
Other banking services designed for customer convenience
include Internet banking facilities, a designated Call
Centre offering free phone banking services, handling of
enquiries and processing orders for credit cards and
Customers can register for e-statements.
Linked to Cirrus
Sinhaputhra savings accountholders can now access
610,000 Cirrus ATMs worldwide and 27 million Maestro
points of sale terminals.
Lanka there are 150 Maestro POS terminals, and
Sinhaputhra savings accountholders can access their
funds at petrol sheds, supermarkets and shopping malls
depicting the Maestro or Cirrus signs.
announcement was made by AGM Savings and IT
Implementation Nalin Jayasundera and Consultant
Investment Promotions Michael Cooke at a recent press
meeting at Sinhaputhra Headquarters, Kandy.
one of the largest fixed deposit bases in the Central
Province amongs Registered Finance Companies (RFCs), the
Company hopes to primarily attract its own deposit base,
whilst opening this product to customers islandwide.
Sinhaputhra Savings also has a unique SMS system and a
payment system called "Simpay," allowing Sinhaputhra
Savers to transact business via SMS with selected
outlets and enjoy discounts on products rather than
incurring a cost to merchants. The SMS facility allows
for balance inquiry and transfer of funds whilst the
website will allow access to monthly statements through
a secured pathway.
added service to the citizens of Kandy, Sinhaputhra
Finance has extended the advantage of its central
location in close proximity to the Kandy Municipal
Council, Kachcheri, Dialog, CEB and leading Banks to
settle a variety of bills and maintain all records for
savings accountholders.The Company celebrated its 30
years of service to the finance industry in February
Interest on interest
Commercial Bank of Ceylon (Com Bank) has begun crediting
a 20% "interest on interest" (in rupee terms) to its
NRFC and RFC account holders in a response to a Central
Bank (CB) directive.
new initiative will further promote inward remittances
and help build up foreign exchange reserves to a higher
level while allowing accountholders to earn bonuses on
top of the interest rates paid by our bank," Commercial
Bank's Deputy General Manager (International) Jegan
instance, if an account holder receives an interest of
US$ 100 on his or her NRFC account, Com Bank will pay
the rupee equivalent of US$ 20 as a bonus.
as the interest paid on NRFC accounts, the interest
bonus too will be exempt from any tax deductions," he
Durairatnam said the logistics of delivering this
service involved opening over 40,000 special accounts
which was carried out in one week-end.
this was possible because of the superior software and
the technical capabilities of the Bank. The bonus
interest calculated using the monthly average exchange
rate of the previous month published in CB's web site
will be paid to the accountholder on the same day on
which the foreign currency interest is paid," he added.
American Express (AmEx) Credit Card, "acquired" and
issued solely by Nations Trust Bank PLC (NTB), partnered
with Keells Super recently to give card members the
chance to win 50,000 Nexus points as well as 50,000
Membership Rewards points each month.
exclusive promotion entitles all AmEx card members who
shop at Keells Super outlets to enter the 50,000 points
draw" said NTB Sales and Marketing DGM Priyantha
members also have the opportunity to transfer their
Membership Rewards points to international Frequent
Flyer programme Asia Miles and to Frequent Guest
programmes such as Hilton HHonors and Priority Club.
Points could also be redeemed at Mackinnons AmEx Travel
and at over 40 local merchants for dining, shopping,
leisure, beauty and wellness offers and gift items.
Nexus points offered through the Keells Super Chain and
the partner outlets may be redeemed at the outlet or
used together with the Membership rewards points.
Imports 42% more than exports
country's import cost in January was 42.3% more than its
export earnings, Central Bank (CB) statistics showed.
imports in January costed US$ 698.8 million, export
earnings amounted to US$ 491.1 million.
However the trade deficit contracted by 66.5%
year-on-year (YoY) to US $ 208 million in January 2009
led by lower trade volumes, CB said.
the agriculture and industrial sectors which were
affected by the decline in commodity prices contributed
to the reduction in growth in export earnings. Lower
demand emanating from the global economic downturn also
had an impact on export volumes. Decline in
agricultural exports contributed to more than 50% of the
decline in exports in January 2009. Tea and rubber
prices decreased by 9.7% and 45.9% respectively.
However, the performance in the exports of textiles and
garments is encouraging as it grew by 4.5% despite
"reduced external demand." But this growth was not
sufficient to compensate for the depressed performance
of the other sub sectors within the industrial sector.
Overall, industrial exports declined by 5.2% to US$ 385
expenditure declined by 40.5% to US$ 699 million in
January 2009. The broadbased decline in imports was led
by petroleum contributing more than 40% to this
decline. The average price of crude oil imports
declined by 55% to US$ 41.71 per barrel in January 2009
from US$ 92.71 per barrel in January 2008. Expenditure
on investment and consumer goods also declined by 42.1%
and 23.6% respectively in January 2009. The current
trend in external trade is likely to prevail throughout
a greater part of 2009 in response to the deepening
global economic crisis.
Private remittances decreased by 6.6%, from US$ 274
million recorded in January 2008 to US$ 256 million in
January 2009. A considerable part of remittances are
denominated in UK pounds, euro, Australian dollar and
Korean won, all of which have depreciated sharply
against the US dollar, contributing to the decline in
remittances in US dollar terms. Remittances in January
have been 123% of the trade deficit, easing pressure on
the current account balance. In consideration of these
developments, both current and expected, the margin
deposit requirements (100%) on certain non-essential
imports imposed in October 2008 have been removed, while
reducing the same (from 200% to 100%) on certain
categories of motor vehicles. This trend is expected to
continue throughout the year leading to much lower trade
and current account deficits in 2009, easing the
pressure on the foreign exchange market.
official reserves with and without Asian Clearing Union
(ACU) funds recorded US$ 1,703 million and US$ 1,415
million respectively by end January 2009. Based on the
previous 12 month average imports (US$ 1,128 million per
month), these reserve values are equivalent to 1.5 and
1.3 months of imports respectively. However, in view
of the current and expected low imports resulting from
the sharp reduction in oil and petroleum product import
bills, the actual number of months of imports is much
Unprecedented economic crisis
think the first thing that we need to recognise is that
there is a global crisis-both an economic recession and
a financial meltdown.
an unprecedented crisis," NDB Bank CEO Eran
Wickramaratne told Benchmark last Sunday.
discussing the downplaying of the negative fallout of
the global crisis by some top-ranking officials and its
effects on our financial and economic landscape.
world economy in 2007 grew at about 5.2%. In 2009 it's
going to grow at about 0.5% (latest estimates are that
it will shrink by 0.5-1%).
Advanced economies grew at about 2.7%. They are going to
contract by 2%. Developing economies like ours grew at
8.3%, and in 2009 they are going to grow at 3.3%. So
it's a huge recession. It cuts across every market. It's
a global recession which virtually covers all
geographies and markets, so it will impact Sri Lanka,"
Commenting on how Sri Lanka will be affected,
Wickramaratne noted: "We are integrated into the world
economy. Our exports are going into the US markets, the
European markets, the Middle East and elsewhere. These
economies are all suffering from the recession and our
exporters are feeling it. So, certainly, businesses are
having cash-flow problems and we have to cope with it."
what can be done about macroeconomic and governance
issues? The show's Special Correspondent Savithri
Rodrigo asked. Wickramaratne pointed out that it was
important to look at corporate governance in relation to
the wider issue of governance.
is an inability on the part of our state, for example,
to reconcile majority rule with minority
aspirations-that's why there is a conflict in this
country-if you look at the corporate governance
framework, it's similar. It's the majority stakeholder
versus the minority shareholder. But I would like to say
that something positive has happened over the last 18 to
24 months, particularly in the banking sector," he said.
can't have islands of excellence with regard to
Governance is a culture; it's the soft issues. It's not
just ticking the box on compliance and regulatory
issues, it's a cultural issue. And that is why the whole
governance culture in the country needs to change. And
corporate governance then becomes a subset of that,"
Wickramaratne told the widely-watched business programme.
Benchmark is presented by LMD and airs on TNL-on Sundays
at noon, with a repeat at 9.05 p.m. The programme is
also carried over DialogTV as well as on LBN and on
Bloomberg Channel on Mondays at 10 p.m. The weekly biz
show is produced by the wrap factory.
Ceylinco finance cos.
Nine months to revive
Registered finance companies (RFCs) under the Ceylinco
Group that has got into difficulties may be revived by
the year end, a commercial lawyer told reporters on
other alternative is for those companies to go in to
liquidation which would result in depositors getting
only a fraction of their savings," Arittha
Wickramanayake, one of four experts appointed by Central
Bank (CB) to oversee the restructuring of these ailing
are The Finance Company PLC (TFC), The Finance &
Guarantee Co., Ltd., Seylan Merchant Leasing Co., Ltd.,
Ceylinco Investment Realty and Asian Finance.
expert group appointed in this connection will be
working sans salaries, said Wickramanayake.
other members of this group are accountant Nishan
Fernando, banker Henanayake Bandara and corporate
manager Ajith Devasurendra.
the biggest and oldest RFC in Sri Lanka with a Rs. 28
billion deposit base.
further measure to bring stability to these companies,
CB has dissolved their executive boards and has removed
their names from the companies' payrolls.
Governor Ajith Nivard Cabraal in his briefing said that
TFC employees had agreed to take a cut in their salaries
while some of its managers as a confidence building
measure have agreed to place part of their salaries as
deposits with TFC.
of its former directors have been retained as
executives, while Guy De Silva, a retired Bank of Ceylon
deputy general manager has been appointed to oversee the
affairs of TFC.
executives are K.J. Yatawara, Mrs. N.C. Rupesinghe, Mrs.
Y.W. Dissanayake and T. B. Ekanayake.
Meanwhile, the Government through the State run
Lankaputhra Development Bank will issue Treasury Bonds
to the value of Rs. 2.2 billion and of a two year
maturity (discountable in secondary market trading) to
buy those troubled RFCs real estate at 67% of its market
value, as a measure to infuse liquidity into those
further stimulous, CB will underwrite guarantees worth
Rs. two billion to banks which have suspended their
facilities to those ailing RFCs in order to revive the
Cabraal also said that seized assets of lessees for
failure to pay their lease instalments would be released
to them without any penalties provided they make a 25%
down payment on the lease outstanding with the balance
to be paid in two years time.(See also main story on
Chamber of Commerce (CCC) in association with the Hong
Kong Trade Development Council (HKTDC) will hold a
briefing session on "How to use Hong Kong and HKTDC Food
Expo for tapping the Chinese Mainland and Asia market?"
at CCC on March 26.
Brandix is one of three nominees for the Energy Globe
World Award in the 'Air' category at next month's award
presentation in Prague for its "green" factory at
Seeduwa. Brandix Group CEO Ashroff Omar said, "It
shows the world that tough economic conditions and the
domestic conflict notwithstanding, there are
manufacturers in Sri Lanka who remain committed to
ideals and standards."
year's Energy Globe Award winners were from Peru
(Earth), Spain (Fire), Mozambique (Water), Austria (Air)
and South Africa (Youth).
SL sells 301 mn. kg.
Lanka sold a total of 300.7 mn. kg. of tea at the
auctions in 2008, marginally higher than the quantity of
299.3 mn. kg. sold the previous year.
this quantity, 264.8 mn. kg. was sold through the public
auction, a 9% year on year (YoY) increase. With the
collapse of the market in Q4 2008, Sri Lanka Tea Board
and the industry collectively agreed to ban private
sales of orthodox leaf tea outside the auction.
for orthodox black tea is the foundation for Sri Lanka's
dollar economies of Russia/CIS and Middle East/North
Africa have always paid a premium for Orthodox Ceylon's.
result, tea sold by private contract declined by 38% YoY
to 34 mn. kg. in 2008. This step proved effective and
concentrated all demand in the auction room. The trading
restriction curtailing freedom of buyers and sellers has
remained in place in Q1 2009 and may well be continued
thereafter. (Asia Siyaka Commodities)
Tea to decline 12%
average tea prices at the Colombo Auctions this year is
expected to decline by 11.8% year on year (YoY) to US$
2.459 a kilo.
other two primary tea auction centres in the world are
also expected to suffer a similar fate. Average tea
auction prices at the Kolkota Auctions are expected to
fall by 14.7% YoY to US$ 1.924 a kg. and at the Mombasa
auctions by 1.1% to US$ 2.1930 a kg.
Meanwhile, the price of the highest paying beverage in
this segment, namely Coffee, Arabica, is also expected
to suffer a dip in prices. Its prices are expected to
come down by 8.2% YoY to US$ 2.829/kg. this year. (World
Bank/ Asia Siyaka Commodities)
Downward revision in earnings
Lanka shipped 319.7 mn. kg. of tea last year, a volume
second only to the record 327.4 mn. kg. shipped in 2006.
country exported 311.7 mn. kg. in 2007.
value of US$ 1.27 bn. last year is higher than the
landmark figure of US$ one bn. earned in 2007.
However, considering the disastrous 4th quarter
following the global credit crisis, it's unlikely that
the country would have received full proceeds as
declared in shipment data.
shippers were compelled to renegotiate or refund agreed
values following the market crash and some are yet to
receive proceeds from customers who have changed
year Kenya exported 383 mn. kg. at a unit value of US$
2.34. Sri Lanka achieved an FOB value of US$ 3.97 on a
quantity of 319.7 mn. kg. Total Kenyan earnings is
around US$ 896 mn.
Meanwhile, India upped exports 10% YoY to 196 mn. kg.
last year. China's export figures should exceed a record
300 mn. kg., of which 78% is green tea and about 19%
black tea. Indonesian figures are projected at 90-95 mn.
kg., 13% of which is green. (Asia Siyaka Commodities)
Ratings on Friday affirmed the National Long-term rating
of Sri Lanka's John Keells Holdings PLC (JKH) at 'AAA(lka)'.
has also affirmed the National Long-term rating on JKH's
senior unsecured notes at 'AAA(lka)'. The Outlook
rating reflects the diversified nature of its
businesses, the currently strong financial profile
driven in part by its high cash position (estimated at
LKR10 bn. as of March 3 , 2009 at the holding company),
continued strong operating cash generating ability and
the dominant market share of some subsidiaries.
$ 700,000 for seafarers
National Union of Seafarers' Sri Lanka (NUSS) in
affiliation with the International Transport Workers'
Federation (ITF) recently launched a welfare fund for
the benefit of the Sri Lankan seafarer community.
General Secretary David Cockroft speaking at the
occasion said that support extended by ITF to the local
seafarers to date amounted to US$ 700,000. ITF Inspector
and NUSS secretary Ranjan Perera was also present at
14 year old wins Montero
Kandasamy (14), an HNB Singithi accountholder won the
Pathum Vimana 2008 Grand Draw prize, a luxury Mitsubishi
Montero Jeep worth over Rs. 11 million.
Kandasamy is the son of Mr. & Mrs. S. Kandasamy of
Bambalpitiya and maintained his Singithi account at HNB
Pathum Vimana is the biggest deposit draw in Sri Lanka
with prizes worth more than Rs. 120 million on offer.
Those include Rs. 20,000 up for grabs daily through the
daily draw and Rs. one million on offer weekly thorough
the weekly draw.
customers also have the opportunity to take part in the
HNB Pathum Vimana TV Game Show where there are no losers
and win cash prizes weekly, ranging from Rs. 5,000 to
Rs.100,000. Regional draw also known as Gamin Gamata has
a total of eight Suzuki Alto cars to be won- each worth
Rs. 1, 600,000. The year end grand draw has on offer a
house worth Rs 10 million and the year-end premium draw
prize is a brand-new Mercedes Benz 'E' Class car valued
at Rs.30 million.
SL not isolated from recession
think 2009 is going to be a very difficult year. By the
second half, we'll see the direct repercussions of the
global recession-even in a country that is small but not
isolated from the global economy," corporate leader
Mahendra Amarasuriya told the widely-watched business TV
programme BENCHMARK recently.
Commenting on the school of thought in some quarters
that Sri Lanka will be insulated from the crisis, he
pointed out that it is important to face reality.
Lanka's foreign exchange comes primarily from the 'three
Ts'- textiles, tourism and transfers of funds from
the developed world in recession, the purchase of
garments will drop.
Although some are saying that tourism will develop on a
grand scale after the war, people in larger economies
won't have money to spend.
transfers, it's likely that Middle Eastern countries
will reduce employment too, since oil prices have
dropped," he said.
Discussing the steps taken by the Central Bank (CB) to
mitigate the fallout, Amarasuriya told the show's
Special Correspondent Savithri Rodrigo that Sri Lanka is
not only facing a "serious financial crisis," but that
the country's reserves had also dropped.
says US$ 2.6 billion, but it's still inadequate to meet
our import requirements for more than six weeks. We
don't have the reserves to play around with," he noted,
asserting that Sri Lanka could not afford to borrow
Commenting on wasteful expenditure, Amarasuriya said
that "the Government must curtail expenditure in public
enterprises and any wasteful expenditure in running the
country politically. We cannot embark on projects like
Mihin Lanka, which is obviously already having problems.
It is apparent that Mihin Lanka cannot be resuscitated.
To put good money after bad isn't a wise economic
whether the military successes would lead to a
junta-like state, he affirmed that this was a
possibility, unless the Government followed this up with
a peace package. "Unless an acceptable peace package
follows, I think Tamils will be disillusioned and will
react in various ways.
Military success has to be followed by a political
package which is acceptable to the majority of the
Tamil-speaking people and the Muslims," he said.
Benchmark is presented by LMD and airs on TNL on Sundays
at noon with a repeat at 9.05 p.m. The programme is also
carried over DialogTV as well as on LBN and on Bloomberg
Channel on Mondays at 10 p.m. The weekly biz show is
produced by the wrap factory.
Computers, authorized distributor in Sri Lanka for Asus
announced the launch of the world's greenest, quietest
and the most cost effective desktop PC in Asus Eee Box,
which measures only "1L" in size, consumes 90% less
power than normal desktop PCs and is one of the quietest
desktop PCs with only 26 decibels sound emission, said a
statement. This product is targeted at the Small and
Medium Enterprise, Home Users and educational sectors.
Speaking on this launch, Epsi group product manager
Sankha Jayaratne said: "With ever increasing concern
over global warming and the looming threat to the
environment, Asus has taken multiple initiatives in
manufacturing green, eco-friendly products. These
initiatives are part of our social and environmental
responsibilities as well as part of Asus' strategic goal
to tap the potential that 'Green Industry' has in
future. "He added that Asus' substantial investments in
R&D for green technology ensures a continuous roll out
of products manufactured from environment friendly
materials, consuming much less power and conforming to
RoHS and WEEE standards.
Jayaratne's said that the Eee Box is yet another
revolutionary product from Asus in the "Eee" product
range. The product will help boost sales in the overall
desktop market in Sri Lanka because of the advantages it
provides in terms of size and power saving, adding that
the Eee Box uses Intel Atom N270 (1.6 GHz) processor
based on new architecture designed from the "ground up,"
specifically for low power and performance in an
ultra-small package. The Intel Atom processor packs more
than 47million transistors into a single piece of
silicon measuring less than 25mmę and has a thermal
design power specification in the 0.6-2.5 Watt range. It
is the smallest processor built with the world's
smallest transistors and a fundamental shift in design,
small yet powerful enough to enable a big internet
experience on devices such as the Eee Box.
Sampath Bank reached another milestone in expanding
their corporate network by opening up their latest
branch in Embuldeniya recently.
new branch is the 114th of Sampath's electronically
linked islandwide branch network that offers
accessibility to banking facilities from anywhere in the
branch is equipped with state-of-the-art technologies
and staff to provide cutting edge financial solutions
and hassle free banking services to the customers in the
Addressing the gathering at the opening ceremony,
Sampath Bank Chairman I. W. Senanayake assured that the
bank will make every effort to deliver the highest level
of customer service, cutting edge financial solutions,
flexibility with a focus on customer needs and the
technology of tomorrow, today.
bank completed a successful year 2008 with a profit
increase of 26.9% and is standing strong amidst a
have now finalised the winners for the ACCA Sri Lanka
Sustainability Reporting Awards 2008 to be held for the
fifth consecutive year.
high profile event which showcases the importance of
sustainability reporting within corporates built on the
global criteria pertaining to GRI guidelines and based
on the concept of triple bottom line reporting will be
held on Wednesday (March 25) at Cinnamon Grand.
Guest will be Export Development and International Trade
Minister Prof. G L Peiris and Guest of Honour will be
Sri Lanka Tourism former Chairman and avid sustainable
development advocate Renton de Alwis.
year's awards saw Holcim Lanka win the large category
award while Union Assurance won the medium category
award. Commendation awards were also presented to
Ceylon Tobacco Company for continuous and consistent
focus on sustainability and Sampath Bank for innovative
projects integrating sustainability principles.
awards, which is a global initiative and is based on
judging guidelines established by ACCA worldwide, is
currently held in over 25 countries and is open to any
type of organisation encompassing all business sizes.
Comprehensiveness, credibility and communication,
identifying and rewarding innovative attempts to
communicate corporate performance which are all aligned
to the sustainability concept are a part of the marking
scheme and according to ACCA Sri Lanka President Nandika
Buddhipala, it is notable that companies in Sri Lanka
now consider sustainability reporting a part of their
"Proper sustainability reporting is challenging at the
best of times, as while it does implement and establish
uniform accountable and transparent guidelines on how
economic, social and environmental impacts of an
organisation should be reported, it also means that
employees from top to bottom, must be made conscious of
these reporting procedures.
most multinational companies around the world consider
sustainability reporting as a responsibility towards
their stakeholders, what we find most exciting in Sri
Lanka is the fact that we have an increasing number of
Sri Lankan based companies that are entering and
winning awards. This is admirable and an assurance
that local companies are permeating global best
practices into their corporate DNA."
ACCA Sustainability Reporting Awards are already
functional in Australia, Canada, Hong Kong, Ireland,
Malaysia, New Zealand, Pakistan, Singapore, South
Africa, Sri Lanka, UK and USA with similar awards
largely based on the ACCA criteria existing in Belgium,
Denmark, Finland, France, Germany, Holland, Italy,
Luxembourg, Norway, Portugal, Spain, Sweden
UNP politico's son in "land grab"
Privileged depositors of the troubled F&G Group were
able to obtain valuable properties in lieu of deposits
which were worth more than the value of the monies due
included a businessman and the son of a prominent UNP
exchanges took place before the government controlled
Merchant Bank of Sri Lanka (MBSL) stepped into to
restructure this failing company.
have put a stop to such cronyism," MBSL Chairman Janaka
Ratnayake told reporters on Tuesday.
Chairman Mervyn Jayasinghe (he succeeded Lalith
Kotelawala now in custody for alleged fraud) told
reporters on Tuesday that they were pressured to give
these properties in lieu of maturing deposits that had
been dishonoured by the company due to a liquidity
Jayasinghe and other F&G directors are currently working
in the company after taking pay cuts. His son is also a
Ratnayake said that if these properties were to be
redeemed back to the company (they had been given on
mortgage), F&G would have to pay back to those cronies
sums very much higher than the actual values of their
Ceylinco's stated capital: Rs. 70
Ceylinco Consolidated( close to near collapse after a Rs.
26 billion financial scandal in one of its
subsidiaries), comprises more than 100 subsidiaries with
30,000 employees.It however has a stated capital of only
Rs. 70, a manager alleged.
Ratnayake, chairman of State controlled Merchant Bank of
Sri Lanka (MBSL) which has been appointed as managing
agent to restructure a number of ailing Ceylinco finance
companies including the F&G Group alleged that this Rs.
70 capital is held by seven individuals, split into
seven shares, each with a value of Rs 10 a share.
shareholders include the now disgraced Lalith Kotelawala
(in remand custody) and his wife Sicille-who is
allegedly absconding from the law.
liabilities, despite dealing in billions of rupees, many
of it customers' money, was restricted to only Rs. 70,"
did their expansion works with other people's monies, he
operated a number of finance companies which are facing
a liquidity crunch after the Rs. 26 billion scandal at
Golden Key, one of the Group's unregulated finance
Migration is good
Lifting people out of poverty requires shifting
populations from villages to cities.
process of migration should be welcomed and encouraged,
says the World Bank's 2009 World Development Report (WDR).
findings are relevant for Sri Lanka, a country where
some view Western Province's growth as a source of
concern, rather than as a source of encouragement.
Globally as well as nationally people move in order to
reduce distance to markets that are prospering. At the
turn of the century, the leading western province
accounted for 1.5 million internal migrants in Sri
Lanka, or around 45% of all migrants in the country.
most effective policies for promoting long-term growth
are those that facilitate geographic concentration and
economic integration, both within and across countries.
new Report makes a strong case for international
integration through trade. Its findings and policy
messages are especially pertinent these days as the
financial crisis has been encouraging protectionist
tendencies in both developing and developed countries.
These will jeopardize both the recovery and longer term
Ripe for revolution
Estimates from more than 100 living standard surveys
indicates that households in the most prosperous areas
of developing countries such as Brazil, Bulgaria, Ghana,
Indonesia, Morocco and Sri Lanka, have an average
consumption almost 75% higher than that of similar
households in the lagging areas of those countries.
Compare this with less than 25% for developed countries
such as Canada, Japan and the USA. (World Bank)
appears that the management of Bank of Ceylon (BoC)
Mount Lavinia Branch had wanted to test the high jump
capabilities of its customers, especially women and the
old, by stringing a two feet high steel chain round its
compound on Sunday March 8.
However, yours truly was still fit enough to clear that
hurdle when he went there to make a transaction from its
ATM machine that day.
ATM has a video display called "Leap," relating to a
partnership it has with a public quoted commercial bank.
Considering the obstacles placed by BoC Mt. Lavinia to
reach its ATM machine especially on a Sunday,
"Breakneck" Leap may be a more appropriate a title.
said that, last Sunday , the height of this chain was
however fixed at height much lower than the previous
Sunday, but, probably still high enough to cause a
problem to some of the aged and the women, coming to
transact business from this branch on a week-end, or,
more appropriately, to make some urgent withdrawals.
WAYs fall steeply
Weighted average yields (WAYs) at last week's Treasury
(T) Bill auction saw the WAY of 91 day maturity T Bills
decline by 52 basis points (bps) week on week to
14.94%, WAY of 182 day maturity by 40 bps to 16.47% and
those of 364 day T Bills by 33 bps to 17.36%.
auction was for the re-issue of Rs. 7,000 million worth
of maturing T Bills of which Rs. 9,855 million worth of
bids were accepted from the market.
Rs. 27.50 tax on industrial LPG
commodity prices, including LPG, a fuel used by both
industry and households are falling due to the global
recession, the government which is cash strapped on
account of the war and of the recession, has slapped a
tax of Rs. 27.50 a kilo for LPG imports for industrial
tax, known as an excise levy, was originally Rs. 8 per
kg., effective from December 31, 2008, but was increased
by more than three fold to Rs. 27.50 effective from
However, industries in the country, especially the
ceramic sector has protected against this tax, saying
that the additional cost would make their products
uncompetitive in the global market.
Bidders get 5.4% margins on SLDBs
Central Bank last week accepted US$ 184.25 million
worth of bids from the total of US$ 200 million worth of
Sri Lanka Development Bonds offered to the market at US$
6 month LIBOR + 5.40% (weighted average margin), with
the US$ 6 month LIBOR rate being 1.88% at the time of
Cheap proteins too expensive
per capita chicken consumption has remained stagnant at
3.5 kilos for the past three years due to economic
reasons, Malin De Mel, General Manager Unical (Ceylon)
Ltd., a veterinary pharmaceuticals company told The
said that chicken and eggs are the cheapest source of
animal protein available in the country.
company recently introduced vaccines from Inve, Belgium,
a manufacturer of veterinary pharmaceuticals, with the
promise of fattening chickens to the pot at a faster and
at a more economical rate.
MBSL takes-over CDB
Majority government owned Merchant Bank of Sri Lanka (MBSL)
has been appointed managing agent to the troubled
Ceylinco Development Bank (CDB), a registered
specialized bank, Central Bank Governor Ajith Nivard
Cabraal told reporters on Monday.
has a Rs. 1.7 billion strong deposit base.
Further, Lankaputhra Development Bank has been appointed
as managing agent for Ceylinco Investment Realty and
Asian Finance, two registered finance companies (RFCs),
whilst Seylan Merchant Leasing, another RFC belonging to
the Ceylinco Group will be acquired by People's Leasing
Company, a subsidiary of State owned People's Bank.
of Sri Lanka (ICASL) announces changes to the effective
date of adoption of SLASs 44 and 45.
order to provide financial statement preparers with
adequate time, the Institute has decided to make it
effective for the Annual Periods beginning on or after
January 1, 2011 (and not January 1, 2009 as communicated
earlier) with early adoption being encouraged. In
recognising the need of having Standards in the area of
Financial Instruments, the Institute has adopted SLAS
44-Financial Instruments: Presentation and SLAS 45-
Recognition and Measurement which are the corresponding
local standards to International Accounting Standards (IASs)
32 and 39.
Sri Lanka Accounting and Auditing Standards Act No 15 of
1995, ICASL is empowered to adopt Accounting and
Auditing Standards in Sri Lanka.
Institute develops and adopts Standards based on
International Standards to improve Financial Reporting
in Sri Lanka.
Chartered Institute of Management Accountants (CIMA) Sri
Lanka Division in collaboration with
in Sri Lanka conducted a Financial Awareness Programme
for HR Managers at the CIMA Auditorium recently.
Regional Director for
South Asia and Middle East Bradley Emerson and IPM Sri Lanka Chief
Executive Dyan Seneviratne were present at the
course was outlined and presented by Richard Pieris & Co
PLC Group Finance Manager Mallik De Silva who has local
as well as international exposure in training non
financial professionals in improving their financial
main modules were on Understanding Financial Statements,
Shareholder Value, Generating Cash and Profits, Adding
Value with Finance focusing on Taxation of employees and
preparing Budgets for the HR Department.
programme was organized by CIMA Sri Lanka Division
Member Services unit.
days you probably feel flooded by dire-sounding
environmental news and endless suggestions for greener
living. But fret not, we're here to help sort things out
and get your eco show on the road.
have a friend, relative, or a colleague who needs a
little help on the green front, send them this way to
Nivasie at Galle Road, Colombo (Close to the Galleface
Green) to get to know more about "eco friendly green
homes surrounded by green in all its splendour at Eco
Town-Victoria Range, nestled in nature amongst lush
green forests, and towering majestic peaks.
to Nivasie Developers (Pvt.) Ltd Assistant General
Manager Dilan Senevirathne in this regard.
Nivasie is the only eco friendly-green home project
developer in the country. Or contact Priyashan or Janaka
Walkers Tours Ltd (the leisure arm of the John Keells
Group) won three Bronze awards for Promoting Eco Tourism
in Sri Lanka, Travel Photography-"Gathering" and Website
(Consumer Travel)- Your Travel Partner in
at the 3rd annual Asia Travel and Tourism Creative
Awards 2008, organised by AdAsia, a leading magazine in
the advertising and marketing field.
today's competitive world, it is important for youth to
learn the international Language, English to enhance
their career prospects in order to be competitive and
have that extra edge.
collaboration with world renowned brand "City & Guilds"
PATHE Academy introduces the World recognised ESOL and
SESOL courses for the people who want to learn English.
at Kirulapana expanded its capacity aimed at starting a
new course schedule through quality upgrading. With
spacious classrooms equipped with the latest
technologies for teaching English.
centre is accessible by public transport and also has a
lot of space for those who travel by vehicles. It caters
to small group classes, thereby focusing more attention
Dominos Pizza introduced a new hotline for its
customers-the'Hunger Helpline'in partnership with Dialog
Broadband Networks, the international restaurant chain's
local telecoms partner.
Associated at this event were Dialog Broadband Networks
(Pvt) Ltd. Channel Sales Manager Hareen Jaimon, Senior
Executive Faiz Subiyan, Dominos Operations Manager
Roshan Ferdinan and Managing Director Maxwell Gihan