Security situ. keeps rice prices high

Pettah traders have written to President Mahinda Rajapaksha saying that the security situation was the reason for the current high rice prices.

K.Palaniandy, President of the Old Moor Street Traders' Association in a letter written on Thursday under the heading "Prevailing High Price of Rice in the Open Market," said: "..members of our society have long experience of seasonal price movement, where, at this time of the year there is a substantial decline in the price of rice due to increased volumes reaching wholesale traders subsequent to the harvests.

However, our investigations have revealed that this year due to the bottlenecks at checkpoints, this free flow of produce is being impeded. The principal checkpoints are those at Manampitiya and Hatharaskotuwa which monitor the movement of produce from Batticaloa, Kalmunai, Akkaraipattu and Polonnaruwa.

Due to an acute shortage of personnel at these checkpoints, lorries carrying paddy are in some instances detained for as much as seven days before being allowed to proceed. Consequently there is a phenomenal increase in transport cost which adversely affects not only the supply price to the market, but also the sale price accruing to the paddy farmer.

There have even been instances where large haulers have declined to transport rice from the producer areas.

In view of the prevailing situation we urge Your Excellency to order an immediate reinforcement of the personnel at critical checkpoints to ensure expeditious flow of produce to the country's wholesale centres."

Palaniandy told The Sunday Leader  said that the reason why rice prices continue to remain high despite the availability of the Maha harvest is because of stringent security checks in places like Manampitiya where lorries from Ampara and Batticaloa carrying paddy to be milled at Polonnaruwa have to pass.

He said that whereas in the past such lorries used to be cleared in a matter of hours, now it takes as much as five days for a lorry to be cleared.

Palaniandy also alleged that there was a mafia behind this operation.

As a result, farmers from Ampara and Batticaloa are affected, he said.

Palaniandy said that as all the big rice mills are located in Polonnaruwa, this has compelled farmers in Ampara and Batticaloa to have their paddy transported to Polonnaruwa to have them milled.

0.03 points prosperity gain in 6 years

 Central Bank (CB) recently compiled Sri Lanka's first ever prosperity index (PI) that seeks to find out whether people's socio-economic conditions have taken a turn for the better or for the worse over a period of time.

 Using 2000 as the base year, the survey found that in the six year period from 2000 to 2006, the PI had marginally increased by 0.03 points, from 0.54 points to 0.57 points on a scale of 0.1 points to one.

PI's main objective was to find how it fared in each of the country's nine provinces in the period under review, CB Statistics Department (SD) Director S. Somapala told The Sunday Leader.

The survey revealed that the Western Province (WP) was way ahead of the rest, topping the national average by 0.11 points to 0.68 points in its PI. The PI in the WP during this period had also increased faster than the national average, by 0.08 points, from 0.60 to 0.68 in the review period.

The Northern and Eastern Provinces recorded the lowest PIs, with 0.49 and 0.48 points respectively, while in the "South," after the WP, the PIs in order of descent were: Southern Province (SP): 0.57, Central Province (CP): 0.56, North Central Province (NCP) and Uva Province (UP): 0.54 each and Sabaragamuwa Province (SaP): 0.52 points.

Somapala said that the PI may not be directly comparable with the UN's Human Development Index  (HDI) or GDP data, as only a few indicators that were relevant to the aforesaid were used in the 22 economic variables that went to compile the PI.

For instance only the variable "per capita GDP" which is common in GDP compilation was used in the formulation of the PI index, he said.

While only a few variables such as "teacher-student ratio," "GCE O/L and A/L qualified persons," "infant and maternity mortality levels," which are also common to the HDI that looks into the performance of indices such as literacy and infant and maternity mortal levels, were  common to both the PI and the HDI, said Somapala.

 CB SD Deputy Director Susantha Ariyaratne however said that the survey had its drawbacks. "For instance we wanted to find out the number of house owners under the Well Being of the People (WBP) sub index, but that data was not available," he said. So we opted for vehicles with combustible engines.

"Similarly, we wanted to find out malnourishment levels which revolves round calorie consumption for the compilation of the WBP sub index, but such data too was not available," he said.

"We wanted to localize the data. For instance, in the USA, in the compilation of the PI, it takes into account the number of unrented office space units available in the comparative periods, but we felt that in the Sri Lankan context such data was irrelevant," said Ariyaratne.

CB SD had to depend on several government agencies to provide them with the required data for the compilation of the PI whose independent verification was not possible. Those included the Census and Statistics Department, the police (for details of crime under the Social and Physical Infrastructure (SPI) sub index) and Health Department.

The PI also captured data sent from districts such as from the uncleared areas of Mullaitivu and Killinochchi provided by the respective government agencies in operation there.

 "Another problem is to get the relevant data on time from the relevant agencies," said Ariyaratne. "For instance we are in 2008, but we are still compiling 2006 data," he added.

Somapala said that this information will be included in CB's 2007 Annual Report which will be out on March 31. He said that the compilation of the PI will be an annual event.

CB Governor Ajith Nivard Cabraal referring to the PI at a seminar on Wednesday said that they were tracking the data captured, whether prosperity is increasing or decreasing, "so far we have seen certain improvements," he said.

Data indicated that the CP's PI from 2000 to 2006 grew by a marginal 0.08 points to 0.56, NCP's by 0.07 points to 0.55, SP's and UP's by 0.09 points each to 0.57 and 0.54 respectively, SaP by 0.05 points to 0.52, NCP by 0.07 points to 0.54, Northern Province (NP) by 0.11 points to 0.49 points and the Eastern Province (EP) by 0.07 points to 0.48 points.

Somapala said that the sharp increases seen in the NP and EP PIs were due to their relatively lower bases from which they began. The North scored in the increase in telephone density and on the number of people who are either O'Level or A'Level qualified, two of the 22 variables used in the compilation of this data in the two comparable periods, said Somapala. The PI measurement, in addition to the 22 variables covered three main areas: SPI; Well Being of the People (WBP) and Economic and Business Climate (EBC). Those 22 variables were sub-divided and included in the afore-mentioned three sub indices in order to compile the PI. The weights that each of these three major indicators had on the PI index were SPI (0.25 points), WBP (0.45) and EBC (0.30), which together make a total of one point.  One of 22 variables used in the compilation of the EBC was the BTT collected in the provinces. Other variables under the EBC Sub Index included per capita GDP, Employment Rate and People above the Poverty Line, ie non Samurdhi beneficiaries.  "Health, Wealth and Education" under the WBP sub index encapsulated indicators such as vehicles with combustible engines-including the number of mo-peds in use in the two comparable periods, number of GCE O' Level/A' Level qualified persons, teacher-pupil ratio, hospital beds per 1,000 population; infant and maternal mortality rates and the increase or decrease in the number of schools per 1,000; while SPI covered indicators such as electricity consumption and penetration per province; road development, telephone and bank densities and crime rate.

$ to trade in Rs. 107/80-108/20 band

The US dollar held steady at the Rs. 107/85 (buying)/Rs.107/88 (selling) levels on Friday with traders unable to make profits due to the dollar operating within such a restricted band that impeded the generation of a higher turnover volume, market sources said.

Turnover was a low US$ 20 million compounded by slack import-export demand, they said. Friday also being the final day of trading in February resulted in investors, particular banks, being careful to not to impair their balance sheets by having too much of debt reflected, especially by way of borrowing from the call money market as they have to send their monthly accounts to the Central Bank, coupled by the fact that they were taking their new investment positioning based on their balance sheet for the new month, whilst at the same time waiting for the February inflationary figures which were to be out on Friday, they said.

The sources expected the dollar to be stable in the new month and to trade within the Rs. 107/80-108/20 band in spot trading in March. They also expected treasury bill yields in the new month to take a gradual dip in the weekly auctions.

Meanwhile, overnight call money market rates, the rates at which commercial banks lend to each other for a day, increased by an average 59 basis points over Thursday's figures to be in the 15.70% levels despite the market showing a Rs. 4.4 billion liquidity.

Sources said that such increases in call rates on Fridays have been witnessed in the past few weeks. They attributed this increase due to the possibility of lenders having had to block their money effectively for three days because of the week-end and hence demanding higher lending rates.

Meanwhile, Statistics Department inflationary figures as released by the Central Bank showed that the point to point increase in the CCPI in February was 4.8% to 24%, while its increase over January 2008 was 2.4% to 24%.

The point to point increase in the new CCPI index (CCPI N) was however much sharper, increasing by 6.4% to 21.6% (February '07 vis-…-vis February '08), while its change over January '08 was a 0.8% increase to 21.6%.

Bourse to be buoyant

Business magnate Dhammka Perera who together with connected companies have a 15% stake in Sampath Bank PLC, did an inter-company transfer comprising a 2«% stake of Sampath valued at Rs. 189 million on Friday, that boosted turnover to Rs. 486.5 million. The seller is believed to have had been Vallibel Holdings one of Perera's companies. However the name of the buying company which is also controlled by Perera is not known.

On Wednesday too Vallibel was involved in an inter-company transfer comprising another 2«% stake in Sampath.

The other institutional/high networth individual trade witnessed in the bourse on Friday was a trade involving Rs. 56 million worth of shares of JKH.

However, due to profit taking, the benchmark ASPI came down by 9.08 points over Thursday's close to finish the week at 2,530.86 points; while the more sensitive MPI fell by 11.56 points to close at 3,172.21 points.

But sources expected the bourse to take-off when trading resumes tomorrow (provided the security equilibrium is not disturbed) due to good corporate earnings shown in the quarter ended December 31, 2007; with the exception of a few sectors such as Motor-Vehicles which fared badly.

The market is liquid and with the plantation sector, driven by good commodity prices in rubber, tea and palm oil driving the bourse, the bourse is expected to be on the upswing in the new week, they said.

Village BPO serving blue-chips

A village based business process outsourcing  (BPO) service that handles part of the backoffice operations of Sri Lanka's largest diversified company, has also been contracted by the country's biggest telecoms operator, whilst having talks to provide similar services to Sri Lanka's largest white goods supplier.

This BPO operation located at Mahawillachchiya, Anuradhapura, that processes data of suppliers' to John Keells supermarket chain (a process that began some months ago) has now been employed by Dialog Telekom to process some of their market research data, Dilip Jayawickrama, Projects Director, Foundation for Advancing Rural Opportunity in Sri Lanka (FARO), an NGO, told The Sunday Leader.

 FARO, which was among seven NGOs to receive World Bank grants of Rs. five million each through the Information and Communication Technology Agency of Sri Lanka (ICTA) on Wednesday  to develop ICT opportunities to the rural and disadvantaged people, provides support to this BPO operation in Mahavillachchiya.

The village youth involved in this project, some eight of them, had their basics right, that is having a working knowledge of English and in the use of computers, due to the work of another NGO, Horizon, said Jayaweera.

"This made it possible for our entry, such a foundation has to be first laid before we can move in," he added. Jayaweera said that outsourcing of this work by Keells has helped them to cut costs, with eight of their staff who were involved in this work earlier, being relocated to other departments.

He alleged that Dialog which hit the top in a short span of under 15 years, with most, if not all of their work done inhouse, were somewhat cautious in outsourcing their work, though a start has been made, with some of their market research data being now handled at Mahavillachchiya.

In the case of Singer, talks have been initiated, with no business deals having been yet procured, he said. Jayaweera further said that he wants to start a similar BPO unit in Seenigama, a village which was devastated in the recent tsunami.

Shortlisted for int'l award

Information and Communication Technology Agency of Sri Lanka (ICTA), the government arm to spread ICT in the country through public-private partnerships (PPPs), has seen the fruits of this endeavour being recognized internationally, with one of its education projects being shortlisted for an award in Spain.

 Shilpa Yathura, a grade six virtual study pack has been shortlisted for an award in Spain, Chitranganie Mubarak, ICTA's programme head, addressing a function at ICTA Hqrs., in Colombo on Wednesday  said.

"If a study on Sigiriya is being done, this study pack will take the child on a virtual tour of Sigiriya," she said.

Mubarak told The Sunday Leader, that grants totalling Rs. five million each under a World Bank funded programme is being offered to partner organizations which assists in developing ICT for the uplift of the village and the disadvantaged; while Rs. 500,000 is being offered to communities for similar development works by ICTA.

On Wednesday , seven such partner organizations received grants totalling Rs. five million each from ICTA. However, this partner programme, which started disbursements in 2006, is now drawing to a close.

Mubarak also said that 100 such community grant projects are currently on stream. Such projects include teaching English through the computer and also the accessibility of content in the vernacular, she said.

Five hundred selfsustaining gnanasalas or knowledge centres have also been introduced under ICTA's drive to spread ICT. "These gnanasalas which are supervised by managers, not only act as internet cafes, but they also carry agriculture material relevant to the rural area from where they operate for the benefit of the farmer community, she said.

Prudential regulations costly

Poor are bankable as a group, Reserve Bank of India Deputy Governor Mrs. Usha Thorat said on Wednesday.

Speaking at a seminar on micro finance (MF), she said that MF empowers the poor.

Thorat said commercial banks in India have opened 46 million MF accounts.

Loans could be six times higher than deposits.

She however said that prudential regulations on MF are costly.

But MF helps the poor to respond to price shocks better. The focus on MF is inclusive growth.

IT solutions offered to MF depositors are smart cards with bio-metric encryption which recognizes and reads the borrower's finger when he handles the smart card.

She said that in India MF loans of Indian Rs. 200,000 are charged the prime lending rate which is between 13«-14%.

The government provides subsidies on interest rates to farmers and small exporters for a limited period of time.

Interest charged on self help group loans is between 22-25%, while their rate of return is between 30-35%...

95% satisfied with GIC

The Government Information Centre (GIC) which maintains a dedicated hotline throughout the year from 8am to 8pm has had a million inquiries since its launch 1« years ago, with 95% of the callers expressing satisfaction with its service and only 2% being dissatisfied with it.

This service is provided by the government run Information and Communication Technology Agency (ICTA) with the state banks and several regional development banks also being roped into this service from Thursday.

 The idea behind operating this service is to enable the public, by making only a telephone call, to get the necessary information he requires of a particular service that he is seeking from a government agency.

ICTA's Reshan Devapura told reporters on Thursday that at present the GIC provides over 1,000 services catering to 55 government institutions. The Centre receives around 1,500 calls daily. The services provided are trilingual.

Vasantha Deshapriya Director Re-Engineering said that one of the biggest problems that this centre is trying to meet is to help Tamils, who would otherwise have to travel to Colombo, to get the necessary information.

Inflation to be high in 1st half

As measured by the New Colombo Consumer Price Index (CCPI(N)), consumer prices increased by 2.8% in February 2008 over the previous month. 

Of this total increase, 66% came from price increases of food items; mainly rice, milk products, bread and bakery products, coconuts, sugar and meals bought outside, while the remaining 34% was due to the increase in non-food items particularly, medicine, gas, kerosene, diesel, petrol and transport.  Although vegetables prices, fish and condiments decreased substantially, these declines could not offset the overall increase. 

With the overall price increase of 2.8% in February, the inflation rate as measured by the year on year change in the CCPI(N), rose to 21.6%, from 20.8% recorded for January 2008, while the annual average rate increased from 16.4% to 17%t between the two months.

The upward movement of inflation that has prevailed from mid 2007 has been largely due to supply side factors such as increased input costs arising from high oil prices and increased world prices of food commodities; mainly wheat, milk products and dhal.

However, to contain the demand pressure on inflation, the Central Bank's (CB's) tight monetary programme has been adequate during 2007 as well as during the first two months of 2008. Consequently there has been a deceleration in monetary expansion and indicative targets on reserve money set for January and February have been comfortably met.  As indicated in the CB Road Map for 2008, it is expected that inflation will decelerate on a gradual path from the second half of 2008 onwards.

Chevron's PAT up 33%

Chevron Lubricants Lanka PLC in the financial year ended December 31, 2007 saw turnover grow by 12% year on year to Rs. 8.7 billion while profit after tax grew by 33% to Rs. 1.1 billion.

New CLPL board

Ceylon Leather Products PLC (CLPL) recently appointed four new directors to the Board subsequent to the acquisition of 25% of the issued share capital by Galleon International Master Fund, New York and 24% of the issued share capital by Lionhart Investments Ltd, London.  M/s. S A Perera & Co. Ltd holds 20% of the issued share capital.

Chairman Nimal Samarakkody said that G.Scott Newsome, Dilan Goonaratne, Kosala Heengama and Kapila Dodamgoda were recently appointed as new directors representing the foreign shareholders, while S. E. Satarasinghe, M. A. Abeynaike, B. .M. Amarasekera and Nihal Abeysekera resigned.

The new Board comprises Nimal Samarakkody (Chairman), Sitendra Senaratne (Managing Director), Dr. Uditha Liyanage, Ranjith De Silva, G. Scott Newsome, Dilan Gooneratne, Dr. Kosala Heengama and Kapila Dodamgoda.

Subsequent to the sale of land (extent 544 perches) in October 2007, which infused Rs 307 million, CLPL is a virtually a debt free company.

CLPL on December 20, 2007  bought a land and factory at Balummahara, Gampaha with a Rs 50 million investment to re-locate the footwear and leather products operation.  However the Company expects the value of this property to double in the event of a revaluation. Refurbishment of this premises which started in end January 2008  is expected to be completed by end  March 2008. The Management is planning to shift the factory in April 2008.

CLPL has signed an agreement for  consultancy services with the Footwear and Design Development Institute (FDDI) India for  the re-location, restructuring and modernizing the footwear and leather products operations.

The shifting of the tannery will free up 760 perches of land at a prime location in Mattakuliya enabling the management to look at options of development. The value of this land is expected to appreciate in light of the proposed new Colombo-Wattala-Negombo four lane highway. It is likely that once the highway is developed the land could fetch in excess of Rs 1 million per perch in the market which would amount to Rs 760 million (Rs 60.80 per share).

CLPL has identified premium priced, high quality leather footwear and leather products as an area for future growth. The Company will not compete with large scale local suppliers on volume footwear but compete with high priced imported footwear. At present CLPL’s turnover is around Rs.40.5 mn., monthly and the management is working to increase the  turnover to Rs. 80 mn in the new factory in May 2008 and then increase up to Rs.100 mn per month  by the  year end. This would result in the Company’s annual turnover surpassing Rs 1 billion in the Financial Year 2008/09. Presently CLPL is the largest supplier of footwear to Sri Lankan defence forces and it is expected that this experience will be leveraged to obtain foreign contracts and is negotiating with several potential buyers from the European Union to expand the export sales within this year.

LG shaves 50% electricity bill

Electricity price hike is imminent, maybe sooner than you think. Are you ready to counter the huge increase in electricity price?

 LG is ready, with new innovative home appliances that save electricity by up to 50%. The long term benefits of LG's innovative energy saving appliances are mind boggling, if you calculate how much you can save for a year. Here are just a few of the latest products.

LG TROMM (Large Capacity) washing machines (WMs) take in large washloads of up to 12kg., saving washtime and electricity. The Intellowasher Technology in LG Tromm WMs is an innovative feature which automatically senses the washing load, texture and quality of the fabrics and stains, quantity of dirt and grime to be removed. It then determines the required water level and duration of washing and automatically adjusts same, permitting smaller loads to be washed economically, thereby saving water and energy and giving you the quickest and cleanest wash ever.

LG's Door Cooling Refrigerator is unique because only LG has an international patent for Door Cooling Technology. The refrigerator has vents on the sides as well as the door which replenishes cool air faster everytime the door is opened and closed. This not only preserves your food better and stays fresher, but also results in greater energy savings and lower electricity bills.

LG ArtCool AirConditioners with new Inverter Technology slows down the compressor speed and permits the compressor to work efficiently even at low speeds while maintaining the desired room temperature. This process results in electricity savings of upto 44% in addition to low noise levels, powerful cooling and healthy, clean germ and dust free air which is a unique feature of its Plasma Air Purifying System.

LG SolarDom Lightwave Oven has a unique curved cavity making the turntable 27% larger to accommodate as much as 60% more.  Further more, it has 3 unique light heaters that cook both inside and outside of the food, retaining the nutrients and taste of the food, minimizing harmful ingredients like fat and preserving the beneficial ones such as proteins. Its efficient heaters cook 4 times faster than an ordinary oven reducing electricity usage by upto 50%.

Abans, the market leader for the world's best brands of home appliances, is the sole agent for LG in Sri Lanka.   A wide range of innovative LG products can be viewed at their showrooms or by logging on to their shopping portal. All products sold by Abans carry the hallmark of quality and the trusted Abans guarantee of an efficient and quick after-sales-service.

Airtel hits 60 mn.,

Bharti Airtel Ltd., India's leading telecoms services provider, recently achieved the 60 million customer mark. This landmark has catapulted Bharti Airtel into the club of top mobile operators in the world in terms of subscriber base. The 60 million customer base covers mobile as well as fixed line and broadband customers.

Bharti Airtel President Manoj Kohli said: "This is a  milestone in our journey towards the 100 million customers mark. Over the last few months we have recorded phenomenal customer growth and this is a testimony to the depth and width of our network as well as our focus on providing affordable services to all. We are committed to taking our network deeper into rural India."

The company crossed the 50 million customer mark in October 2007. It added the next 10 million customers across mobile, fixed line and broadband in just over 4 months.

The company crossed the 10 million customer mark in January 2005 and in July 2006 it crossed the 25 million customer mark.

Mobitel introduces MBF

Sri Lanka Telecom Mobitel (SLTM)introduced "M Best Friend," a new concept to its SMART feature. It will offer a special tariff

for those who use the Smart M Best Friend number for voice, video and SMS.

This further demonstrates the price innovation of Smart, helping to create an aura of 'smart connectedness' around the brand.    

    Speaking on the significance of the new feature, Mobitel CEO Suren J Amarasekera said, "The introduction of M Best Friend (MBF) is in keeping with our positioning of SMART as a value innovator, making Smart once again the smartest pre paid service in the country where video calls too are included.

It will cater to the various youth segments by using the most appropriate connectedness aspect. It will also create a high level of awareness among Smart users and potential users of the multitude of connectedness benefits that the product offers."    

    The key elements of this dynamic offer are the availability of the MBF feature for both existing and new Smart connections. Smart users will have to enter the MBF number which can be any Mobitel number, pre paid or post paid, using a simple SMS.

No daily rental is applicable for the feature. In addition, the nomination of the first number for MBF is free.

    This will also go a long way in reinforcing in the minds of existing users brand loyalty as well as attracting potential new users and users of other pre paid services to adopt SMART Pre Paid services.

    SLTM, the national mobile services provider is a wholly owned subsidiary of Sri Lanka Telecom. In January 2004 the company launched its full-fledged 2.5G GSM network that is EDGE/GPRS enabled.

In December 2007 Mobitel launched South Asia's first and only network with super 3.5G HSPA technology. Investments committed to date in its 3.5G/2.5G networks and service offering totals over US$ 200 mn., and is set to increase its present 1,000+ base stations to 1,500 by the year end.

Dialog aids blind soldiers

Dialog Telekom PLC (DTP) gifted a Digital Listening Library (DLL) and Therapeutic Centre (TC) to Ranaviru Sevana (RS) in Ragama  recently.

The Centre was built to empower soldiers undergoing rehabilitative therapy for cognitive and visual impairment.

The handing over of the state-of-the-art centre took place under the patronage of Sri Lanka Army (SLA) Chief-of-Staff Major General Lawrence Fernando.

The DLL and TC is the first of its kind in Sri Lanka. Built on the RS premises, the Centre provides audio based knowledge and learning services for RS soldiers.

The facilities at the Centre include digital audio recording facilities, an audio library for the visually handicapped, a recreational area as well as physiotherapy, speech therapy and IT training facilities.

The audio library has a wide selection of audio books ranging from current affairs and news to popular short stories and poetry, with an IT room with access to the internet.

In a message to mark the occasion, SLA Commander Lt. GeneralG.S.C. Fonseka said, "Today is an important day in the calendar of the Sri Lanka Army on which DTP, a leading stakeholder of the economy of Sri Lanka has stepped in to support the worthy cause of enhancing the facilities afforded by the SLA to rehabilitate its members with disability. At RS, we have always recognized the relevance of offering the best services to soldiers with disabilities who have sacrificed their physical well being for the integrity of our motherland."

Ceylinco Insurance streaks ahead of the pack

Ceylinco Insurance PLC  (CIP) created history once again by becoming the first listed insurance company in Sri Lanka to record an after tax profit of over Rs. 1 billion, a feat it achieved for the year ending December 31, 2007.

The company has also retained its position as Sri Lanka's insurance industry leader in the concluded financial year, with market-leading performances from its Life and General Insurance Divisions, reporting a consolidated Gross Written Premium Income of Rs 17.2 billion.

General Insurance (GI) reported premium income of Rs 10.35 billion comprising Rs 6.2 billion from Motor Insurance and Rs 4.1 billion from Non-motor insurance. This represented an increase of over Rs 800 million in GI over 2006 and gave CIP a robust 37.1% share in the GI market.

The company's Life Insurance Division (LID), Ceylinco Life grew by 20% in the year reviewed to achieve premium income of Rs 6.8 billion, a Rs 1.1 billion increase over the previous year. This performance enabled the Division to increase its share in the LID market to 34% according to available industry figures.

CIP also had its share value peak during last year, with the per share value reaching Rs 232 in March 2007.

This is the fourth successive year of industry-wide leadership in both the Life and General segments for CIP.

Contributing to this record profit were several new strategies adopted by the company in the period under review. Commenting on the General Division's performance, its Chief Executive Director Ajith Gunawardena said: "We performed beyond expectations in 2007 in terms of market share. We believe that the innovation and courage embodied in the revolutionary changes CIP introduced in the year under review were catalytic in generating unprecedented trust in insurance, and combined with the visionary leadership of our Chairman Dr Lalith Kotelawela, together with the support of Dr. (Mrs.) Sicille Kotelawala, the Board of Directors and the unfailing commitment of our staff, helped us to climb to the zenith of the insurance pinnacle."

He disclosed that despite the eruption of competition in the Motor Insurance segment, CIP had seized an unbeatable 41.2% share of that market in 2007, while in Non-Motor the company accounted for a hefty 34.5% chunk of the entire market. Profit for the 12 months reviewed exceeded Rs 1 billion, a 24% growth.

Ceylinco Life (CL) Chief Executive Director R. Renganathan said LID had sold 165,796 new policies in the year under review, achieving an average of more than 13,800 new policies a month. Its Life Fund grew by 21% to reach Rs 16.83 billion as at December 31, 2007 following a transfer of more than Rs 2.9 billion in the year. Investments increased by 14% to Rs 14.8 billion, while assets grew by 19% to Rs 19.38 billion, he said.

"These are creditable results in any circumstances," Renganathan said. "CL's market share, computed on the basis of premium income continues to grow and the gap between CL and its closest competitor has widened further, despite the tough market conditions that prevailed in the year concluded."

He attributed the company's success to the far-sighted leadership of Dr. Lalith Kotelawala, and Dr. (Mrs.) Sicille Kotelawala, its sales force and policyholders. The company's efforts in 2007 to push life insurance penetration beyond the 10% level and the resultant high profile media and interactive campaigns, the spectacular Ceylinco Life Family Sawari promotions and the focus on innovative and market-responsive new products also contributed to growth. "But above all, it comes down to building trust and confidence among people in all segments of the population and in all walks of life," Renganathan said.

Gunawardena said the introduction of On-The-Spot claim settlement in all categories of insurance offered by the Division has revolutionised the insurance industry the world over, achieving yet another 'global first' for CIP. "Moreover, with the introduction of the On-The- Spot claim settlement method to cover all our insurance solutions in January 2007, a distinct change took hold in the home front-Sri Lanka.

People developed a deep-rooted trust in insurance as a concept that will work to their benefit."

Another major strategy implemented last year was the introduction of the 'Three-In-One' concept to VIP On-The-Spot. This ensures that customers do not lose their 'No Claim Bonus' regardless of the number of claims they make during the year, the increase of the insured value of the vehicle by 10% year on year with no further burden on the customer and the payment of up to two lease instalments on leased vehicles in the event of a repair lasting more than 30 days.

CL, meanwhile, introduced three new products to the market in the year under review, Ceylinco Double Growth, a policy that could triple in value over time while premium payments remain constant; Ceylinco Major Surgery, an enhanced insurance plan that covers 525 different surgical procedures and Ceylinco Family Digasiri, an expanded and upgraded critical illness policy to cover five new critical illnesses.

A highlight of the year was the CL Family Sawari, a six-month mega promotion for existing and new policyholders which culminated with 58 Sri Lankan families winning an all-expenses paid holiday in Singapore, and 400 other families winning a full-day package to the Leisure World theme park in Avissawella.

Canada commits Rs. 1 bn., to Sanasa

The Canadian Government, through the Canadian International Development Agency (CIDA) has made a C$350,000 (SLR 37.24 million) provision to Sanasa Development Bank (SDB) to finance a debt restructuring programme through  Sanasa primary societies (SPCs) in the Tsunami Impacted Areas Programme.

Canadian High Commission Angela Bogdan said: "Canada is pleased to be continuing this cooperation with Sanasa and particularly to reach 203 tsunami and conflict-affected SPCs in the east. Together with CIDA, the Canadian Cooperative Association, Developpement Internationale Desjardin, and the Canadian Red Cross, Canadian assistance over the next 7 years to Sanasa will total over $11 million Canadian dollars or more than Rs. 1 billion.  This investment will assist Sanasa in meeting the needs of its SPC members throughout the country and is an excellent example of people helping people."  

 The recent grant will assist Sanasa in expanding their debt restructuring programme with SPCs to the eastern tsunami-affected districts of Sri Lanka and builds upon previous CIDA support to Sanasa for debt restructuring to 103 tsunami affected SPCs in the south.

Bogdan presented the cheque to Sanasa Leader Dr. P.A. Kiriwandeniya at SDB's International Relations office in Colombo recently.

The Sanasa movement represents nearly 8,000 SPCs with a membership of over 800,000 people throughout all districts of the country including the North and East.  Throughout its 20 year history and under the leadership of Kiriwandeniya, Sanasa has been a unifying force for regions ravaged by ethnic conflict and later by the 2004 Tsunami.  Sanasa is committed to action through self-reliance and is an important cooperative network in the delivery of micro-finance, relief and development services.

This Canadian grant will support losses incurred by SPCs whose 40,000 members were most affected by the Tsunami, losing family members, assets, financial records and their cooperative infrastructure. This recapitalization will benefit the very poor plus other levels in Sanasa such as debts to SDB by the SPCs.

Bogdan congratulated Kiriwandeniya and the Sanasa group for bringing distinction to Sri Lanka as one of the world's leading micro-finance Institutions as awarded by Forbes (business) Magazine, which has rated the world's micro-finance institutions.

 Sanasa was the only Sri Lankan institution to have made the top 50 list of Forbes Magazine as number 50th in the world.

Disaster Management and Human Rights Ministry Additional Secretary G.K.D. Amarawardena, Sanasa Federation Chairman Wanigasekara, Sanasa Bank Chairman Gunarathna, Sanasa Development Bank CEO Nimal Mamaduwa and Canadian High Commission's First Secretary (Development) Calvin R. Piggott were also present at this occasion.

Ronan gears for Avurudhu

The shops at Ronan International Centre (RIC) are opening their doors to the public.

Speaking to The Sunday Leader, RIC Chairman Rohan Nanayakkara said that the up and coming mall would dazzle shoppers like no previous mall ever has.

Nanayakkara said that the mall is designed to have a host of activities which will keep shoppers of all ages entertained for hours on end.

The world-class shopping-leisure-entertainment experience that RIC will provide shoppers (more than just high end shopping) for the coming Avurudu season are many 'first of its kind' functions.   

The Rs. 644 million, 72,000 square foot "covered" space, `Destination Mall with a Difference' is a concept of R-Group International (RGI) headed by Nanayakkara. RGI builds on the legacy of one of Sri Lanka's pioneer companies, Ceylon Carriers Ltd., with over six decades of experience in the logistics and hospitality industries.

A host of internationally and locally acclaimed stores will be housed at RIC and will offer lifestyle products and accessories from winning international brands. 

The retail floor spaces in each floor of the buildings are designed with aesthetics and functionality in mind, encouraging store-front design that would create a lasting first impression.

Since image and identity mean brand recognition that affects consumption, RIC's aim is to promote differentiated brand experiences to customers. This is why each floor is laid out to include brand/product focused centres, giving due place to the best and winning brands. The circulation pattern inside the mall is designed in a manner that each floor has optimum footwall that eases consumer movement and provides higher visibility for retailers.

The RIC management is also considerate of the idea of trade exclusivity where appropriate, as a way to reduce merchandize duplication and repetition, as well as a sense of prestige in the retailer.

A destination mall is one that offers a unique and attractive mix of lifestyle products, leisure and entertainment activities that make people to travel a greater distance to shop, relax and to be entertained. That is now made available in Sri Lanka.

RIC consists of four state-of-the-art buildings complemented by a 250+ parking and an eco-friendly outer area. One of the sections is already anchored by Keells Flagship Supermarket, contributing to foreign and high end Sri Lankan customer inflow on a daily basis and has already achieved the highest basket value in the "Keells Super" chain within just a few months of operations.

The visitor inflow is expected to increase further, given that the Centre is located outside of the City's high security areas and accessible by the highway and with the opening of more shops in the complex, plus the fact that the mall is open into late hours, 365 days a year.

Since 'parking' is the first encounter a visitor experiences, RIC has paid attention to this and has made available parking space. The area is facilitated by Courtesy Officers who will direct you to the boutique you wish to visit.

Stress-free shopping is possible with sit-downs on every floor complemented by elevators and elevated corridors linking each building. The eco-friendly design boasts of open spaces, landscaped greenery and water fountains as well as alfresco sit-outs to relax and interact. A controlled microclimate and dust control regime makes the Centre friendly and safe for kids and the elderly.

A special prayer room for the Muslims is another unique facility.

Restrooms are equipped to the highest international standards with the latest of sanitary ware and accessories.

 Also catering to disabled persons and children where even diaper changing areas are provided. Hygienic standards are further enhanced by the use of sensor controlled apparatus.

Before long, a body care centre including a Luxury Spa, areas for meditation, yoga, a pet care centre, aerobics, a dance studio, function rooms, a fine dining areas and a special children's centre catering to different age groups will become a part of the complex.

SLT-Mobitel showcases future tech

 Sri Lanka Telecom (SLT)was the principal sponsor and communication service provider for the Deyata Kirula National Development Exhibition. It was held at the BMICH for the second consecutive year as part of the government's development endeavour under the ten-year plan outlined by the Mahinda Chinthana initiative.

SLT together with Mobitel showcased the future home by using world class technologies.

The SLT digital lifestyle stall at the exhibition allowed visitors to experience the digital lifestyle by bridging the information and technology gap through world-class technology.

The stall featured an automated operation of home appliances, music and other personal features, which included chatting, facebook, music making and recor ding as well as fixed mobile convergence.

Connectivity for the stall was provided through the SLT broadband network and M3, Mobitel's 3.5G mobile broadband network, the first and only HSPA network in South Asia offering the fastest mobile internet access using 3.5G technology.

Video calls, video blogging and the Mobile Eye were among the features on offer in addition to mobile TV and the future of home living, where one is able to operate home appliances through the mobile phone.

Mobitel customers were able to watch what was happening at the stall live by dialing a video call to 555 on their Mobitel 3G phone.

SLT provided broadband connectivity to the BMICH, allowing more than 100 stalls to have access to high speed internet, video and telephone services.

Services provided by the company to the exhibition organisers and stallholders included telephone services for voice communication, PABX services for inter branch voice communication, GSM mobile phones through Mobitel, high capacity dedicated data connectivity on the SLT broadband network and ISDN services for video conferencing facilities.

SLT assured communication requirements of all the stalls by providing  broadband internet services for them through SLT ADSL technology,  wireless internet through 20 Wi-Fi hotspots at different locations so  that people had the opportunity to access wireless internet and also  Mobitel M3 services.  

M3 mobile broadband services facilitated to bring live exhibition coverage on Mobitel's mobile TV platform by Lankapuwath.

SLT provided Metro Ethernet (ME) connectivity to the BMICH to handle high speed data. ME which is a fibre optic network operated by SLT delivered high-bandwidth connectivity solutions to corporate offices and important locations like BMICH.  SLT has already rolled out its ME services to support advanced data, voice, video and higher speed internet services. It is a metro access network of fibre optic rings based on MPLS technology providing connections to high rise buildings.

The company's optical fibre ring network has been designed to provide high transport capacity which was interconnected to all provinces in the country. The network  establishment facilitates seamless connectivity islandwide.

Deyata Kirula National Development Exhibition showcased the country's history, from the present situation to the future, as well as enlightening the public regarding the development initiatives undertaken by the Government.

AAI passes Rs. 100 mn., profit mark

Asian Alliance Insurance PLC (AAI) marked yet another exceptionally successful year recording a Rs.114 mn., profit before tax and Rs. 113 mn., after tax profit for 2007, a 60% growth over the previous year.

With the above performance, earrings per share increased to Rs. 4.63 and return on capital by 42%.

Company investments grew by exploiting the prevailing interest rate environment with the yield increasing to an average of 14.5%-a Rs. 1.5 bn., increase.  The company met the required Solvency Margin of Non Life with a Solvency Ratio of 4.10 and of Life with a Solvency Ratio of 3.15 based on solvency rules applicable.  The company obtained a BB1 rating from Lanka Rating Agency for its claims paying ability.   The Management views this rating positively as AAI is a relatively new entrant to the industry.  The rating achieved was awarded on a standalone basis on the soundness of the company's operational and financial strength.                                                          

The Life Insurance Division recorded a strong performance in the year in review to achieve an Annualized New Business Premium (ANBP) of Rs. 355 mn., with a 19% growth in Gross Written Premium (GWP).  The Company maintained its high persistency rates, managed policy surrenders, expense ratio and increased the Life Operating Surplus by 29%.  In terms of earnings and financial soundness, the Life fund rose to Rs. 888 mn., and  Investments increased by 56% in the year 2007. 

Fierce competition continued among market players in the Non Life insurance industry to increase their portfolios and thereby improve market shares.  AAI adopted a "walk away" price strategy with a view to protect the Company's exposure to disproportionate risks and ensure value to policyholders. Furthermore, the technical and underwriting standards of the Company were not compromised and hence the credibility and professionalism of AAI was upheld.  This strategy held the The conservative management approach adopted over the last 3 years, succeeded in erasing accumulated losses and increase shareholder equity to Rs. 268 mn.

AAI is poised to meet the requirements and proposed changes that may be adopted from time to time by the Industry positively. "We look forward to the changes as challenges to be faced with, in our characteristic vim and vigour.  We see these changes as windows of opportunity to exploit and achieve excellence." Company in good stead and it is now ready to meet changing market trends and demands.

JKH in "Super 10"

The John Keells Group, the largest listed conglomerate in Sri Lanka bagged a sizeable quarter of the awards at the HRM Awards 2007- Super 10, held at the Cinnamon Grand recently.

The awards tally was five-1 gold and 4 silver-of the available 19 awards (10 gold and 9 silver).

The winners comprised subsidiaries and associates of John Keells Holdings PLC (JKH). They were: Keells Hotel Management Services Ltd. (Gold award) and Trans Asia Hotel, John Keells Computer Services, Union Assurance PLC and Nations Trust Bank, Silver awards each.

Under the theme 'Celebrating the people factor in business growth,' the candidates were evaluated on a number of criteria including organisational leadership and best HR management practices.

The judges panel comprised Postgraduate Institute of Management International Centre, Emirates Managing Director Professor Gunapala Nanayakkara; Aditya Birla Group Director Dr. Santrupt B. Misra; Public Service Commission, South Africa Commissioner Dr. Norman Maharaj; World Bank HR Strategy Senior Adviser John Lavelle; CIMA Sri Lanka President Aruna Fernando; Employers' Federation of Ceylon Director-General Ravi Peiris and ICICI Bank Global HR Head Ramkumar.

The awards were open to all organisations (public and private sector) with a minimum of 50 employees and at least one HRM specialist who has been operational in the past five years and  "located in Sri Lanka." Many companies ranging from financial services, hotel and hospitality, IT, garment manufacture, pharmaceutical, trade and industry vied for selection to be amongst the Super 10.

JKH Chairman Susantha Ratnayake said: "We are delighted at receiving the awards, to us, they are recognition, not of the John Keells Group alone - they are also the recognition of the people who make up the Group, who make it come alive in so many ways."

John Keells Group HR and Legal President Ms. Dilani Alagaratnam said, "At Keells our team is our driving force. From facing new challenges to organising a sports event; from meeting high business targets to volunteering in social responsibility activities; our employees are constantly on the move, raising the bar, challenging themselves, making the Group what it is today.

We work towards making JKH 'more than just a workplace,' and these awards confirm that our efforts have not been in vain.

Awards such as these help us to benchmark what we do as part of HR best practices, to learn from each other and better our approach."

She added, "Even though JKH as a company did not compete, we are happy that our subsidiaries have showcased the HRM competencies and talents that we possess within the Group."

The HRM Awards was organised by the Association of HR Professionals (AHRP) for the 3rd time, with the intention of highlighting the value and potential of human resources (HR) and the importance of equipping them with skills and competencies through which they may be strategically managed to ensure efficiency and productivity.

This year, the involvement of Hewitt Associates (India)-the world's leading organisation specialising in HRM and consultancy services-signals positively of the standing for HRM in Sri Lanka. With more than 65 years of experience, Hewitt Associates has consulted with more than 2,300 organisations, administering HR, healthcare, payroll and retirement programmes for them. Hewitt's global footprint extends to offices in 35 countries  employing 24,000 associates. Hewitt India has been partnering with leading organisations in Sri Lanka for over 5 years.

STC-A success

The Seylan VISA Traveller's Card-the first of its kind in Sri Lanka - has proved to be a success.

This card is an alternative to travellers' cheques (TCs) and is ideal for those travelling abroad. It is a pre-paid VISA accredited card that provides a secure and convenient electronic payment option when travelling overseas and avoids the risk and hassle of handling cash or TCs.

The Seylan Traveller's Card (STC) is denominated in 3 currencies, namely US Dollars, British Pounds and Euros, but can be converted to the local currency of any country one visits. There are no fixed denominations. It facilitates ATM withdrawals from over 1 million VISA accredited ATMs in more than 150 countries worldwide and could be used to buy goods and services at over 12 million merchant outlets.

Users of this card now consider it a safe and convenient facility when travelling overseas. Many are the benefits in having this card. There is no need to go to a foreign currency changer. Furthermore, card transactions could be viewed through the web and the Card could be activated through the Web too. Customers will also receive an additional card which could be given to their travel companion or used as a back-up in case the main card is lost or stolen. The card will be deactivated immediately after being informed of its loss/theft. Cardholder receives an SMS each time they carry out a transaction.

Regardless of the amount withdrawn, the withdrawal fee is just US$ 2 and there are no additional charges when the card is used to buy goods and services. As for the unutilized balance, the user could encash it over the counter or from any Seylan ATM or advise the bank to transfer the balance to his/her rupee account.

Another benefit is free travel and medical insurance every time one travels with the STC. This card could be obtained over the counter at any Seylan Bank branch islandwide or at travel agents authorized to release foreign exchange. "It is valid for 6 years and could be reloaded each time you travel. It also comes with good security features-a unique 4-digit PIN number secures transactions and protects your funds. To obtain the card, you are not required to maintain a bank account."

SLT secures Amba's communications

 Sri Lanka Telecom (SLT) has signed an agreement with Amba Research Lanka Ltd. (ARLL), one of the leading investment research support service firms to provide communication solutions that include voice and broadband internet services.

The solution comprises multiple services with state-of-the-art PABX infrastructure and dedicated high capacity digital E1 connectivity for voice communication.

As a result of this agreement, the SLT solution will seamlessly connect Amba Research, Colombo office to their international offices. ARLL Managing Director Ravi Abeysuriya said: "SLT is one of the largest telecoms operators in the country. They are also Sri Lanka's major international connectivity provider enjoying strong ties with other global operators. Amba being a global investment research support firm is happy to tie up with SLT for our communication requirements."

The solution offered by SLT helps the customer with direct cost savings, making operations smoother as they have access to their international offices from Colombo, at anytime.

Also it will help to enhance capabilities of the customer with real time communication between their international branches by giving access to financial information, the company's investment information, research reports and credit research analysis.

Along with the communication solution, SLT will guarantee security for ARLL's voice and data communication by using world class technology.

Amba will also enjoy dependable broadband services over SLT high speed links that will connect their local offices to corporate offices worldwide. SLT is the only Telco in Sri Lanka that  operates an aggregate bandwidth of over 2GBps on its international internet backbone.

This backbone consists of multiple optical fibre under sea connections and a satellite link that together operate in a complete failsafe configuration.

SLT CEO Shoji Takahashi said: "We are happy to be the communication solutions provider for the globally reputed Amba Research. Through our unmatched services we are pleased to further enhance Amba's business capabilities."

SLT has the capability to serve the future demands of any corporate in Sri Lanka, with the company's already laid down giant infrastructure for international and domestic connectivity which can serve customer's  communication need, especially in terms of IP (Internet Protocol) services.

SLT's Global IP services like Global VPN connectivity and IPLC connectivity to international offices and high bandwidth metro ethernet connectivity also gives companies freedom to run their businesses globally and locally as well.

Also SLT internet Data Centre (iDC) plays an important role by providing data hosting services to SLT corporate customers with the highest international security standards for customers' valuable business critical data.

Amba provides specialised support services in the areas of investment and analysis. Their clients include the world's top investment banks, leading asset managers, hedge funds and credit evaluation firms.

The company has wide expertise in equity research for both public and private companies, fixed income, credit and quantitative research.

HR capacity building

CIMA has initiated an HR Leaders' forum that will be held on Wednesday at the CIMA division, Colombo.

It's an initiative to network a group of leading HR professionals in a bid to develop  synergy, mutually beneficial to CIMA students, members and HR professionals.

CIMA Sri Lanka Division (SLD) President Aruna Fernando said, "CIMA believes that HR professionals should understand the scope of the CIMA qualification and what it offers in relation to the changing environment and how the curriculum is updated to meet international standards.

It is with this objective that the CIMA SLD has taken steps to meet with employers and propagate the facts in order to create an understanding of how CIMA students and members could contribute towards quality financial management in their organizations."   He added: "We believe in working in unison with other professional bodies and building alliances to develop professionals.

Our end objective is to build a high potential talent pool that would serve the national cause of making available quality professionals for future employment not only in Sri Lanka, but internationally as well."

The HR Leaders' Forum is an initiative of CIMA SLD Employer Relations committee chaired by Dinesh Weerakkody, who is a CIMA member as well as an HR professional. Weerakkody said: "The single thing that will make or break an organisation's growth and success is the quality of human resources (HR) it can attract, retain and develop.  "Many of our young professionals are seeking opportunities in Australia, Africa, Middle East, UK and Canada. Sri Lankans are wanted for middle management positions in finance, IT and engineering in the West and in the region. Therefore, the movement of good Sri Lankan talent could and will create a talent shortage which would challenge our economic potential. Therefore we need to start accelerating our talent development to ensure that we are developing a growing cadre of managers and establish management practices that enable us to have depth in our talent pipeline. So whilst one aspect of the meetings will be to work alongside HR Leaders to build and grow the CIMA talent pool, the other aspect of the programme will be to provide HR leaders an opportunity to share their experiences."

The inaugural HR Leaders' forum will feature a presentation on Global HR Challenges by Director Global HR Head PD Courtaulds Richard Cowlishaw who counts over 15 years experience in HR Management gained in a variety of blue chip organizations in the Insurance, Retail, Construction and Apparel Manufacturing sectors.  

NDB's earnings up 50% to Rs. 1.5 bn

NDB group's (NDB) profit attributable to shareholders increased by 50% to Rs 1,521 mn., from Rs 1,014 mn., last year after excluding the Rs. 1.01 bn., exceptional capital gain generated in the2006  first quarter on the sale of the controlling interest in Eagle Insurance Company Ltd.  Group's profit after tax (PAT) also increased by 37% to Rs 1,637 mn., from Rs 1,191 mn., from the previous year after excluding the Rs 1.01 bn., exceptional capital gain.

NDB Bank continued to make strong progress in widening its business base by offering a range of banking products to its corporate, SME and consumer customers. The Bank continues to invest in building brand, distribution channels, IT systems and trained people on whom its success depends.

There is also focus on customer deposit mobilisation through new branches and product offerings. Despite this continuing expenditure on investment and the change process, performance for the year 2007 has shown healthy growth in profits.

For the Bank alone operating profit before provisions for the current year was 2,411 mn., as compared with Rs 2,090 mn., the previous year, a 15% increase.  These results were after expenditure incurred in investing in the growth of new business lines referred to above. Profit before tax increased by 12%, from Rs 2,086 mn., in 2006 to Rs 2,342  mn., during the year while PAT also increased by 10% over 2006. PAT excluding equity capital gains of Rs 249 mn., for the current period and exceptional group dividends of Rs. 308 m. during the corresponding period last year was Rs .904 mn., as compared with Rs 760 mn., a 19% increase. Overall, core banking revenue (net interest income, forex and commissions) of NDB Bank grew at a strong 25% pace based on a significant growth in loans of 16% and deposits of 21% over the previous year. The Bank now has 40 branches, which act as distribution channels supporting the various business areas-Corporate banking, SME lending, Retail Banking, Investment Banking and Insurance.

Bank Net Interest Income grew at 26%, from Rs. 2,402  mn., in 2006, to Rs 3,022 mn., for 2007. This was due to the increase in the bank"s gross lending portfolio from Rs 44.2 bn., as at December 31, 2006 to Rs 51.6 bn., as at December 31, 2007. Bank"s total assets grew from Rs. 63.2 bn., to Rs. 73.2 bn., during this period, a 16% increase. There was also a significant increase in customer deposits which was Rs  25.6 bn., as at December 31, 2007  compared to Rs. 21.2  bn., as at  December 31,  2006, a 21% increase.

Net other income of the Bank excluding equity income for the year was Rs 822 mn., as compared with Rs 666 mn., for the comparative year mainly due to the steady increase in commercial banking fees and commission and forex income. The Bank has also diversified its avenues of fee income through Bancassurance and Western Union Money Transfer. NDB Bank together with Dialog Telekom has developed and launched South Asia's first M Commerce programme, eZ Pay, a method to make payments for goods, services and utility bills through the mobile phone anytime, anywhere in Sri Lanka. This development is expected to increase both institutions' customer base.

Provisions for doubtful debts were Rs. 68 m. for the year as compared with Rs 37 m., in the previous year. Total specific provisions including judgmental provisions made over and above the minimum Central Bank (CB) mandated provisions as at December 31, 2007 amounted to Rs. 1,369 m., compared with Rs 1,508 mn., as at the previous year. Total provisions as at December 31, 2007 amounted to Rs.1,806  mn., compared with Rs 1,783 mn., as at the previous year. 

During the 2006 last quarter, CB mandated a 1% provision on the performing portfolio of each bank. Banks have been given time to make this provision over ten quarters ending on March 31, 2009. However the Bank has accounted for the 100% general provision requirement as at  December 31, 2007 which amounts to Rs. 437  mn.

Shareholders' Funds as at  December 31, 2007 amounted to Rs 9.25 bn., and Rs 11.68 bn., for the Bank and the Group respectively which are in excess of the regulatory minimum standards. Bank"s Tier 1 and Tier 2 capital  and the Group amounted to 19.68 % and 26.25 % respectively compared with the regulatory minimum of 10% and this positions NDB Bank for future growth.

Bank overheads increased by 27% as compared with the previous year. The increased expenditure was due to investing in the growth of new business lines referred to above. Despite increased expenditure, the Bank's cost income ratio of 44% for the current year still compares favourably with the ratio of other local banks.

The bank"s effective overall tax after excluding exceptional equity capital gains was 57%. The effective overall tax rate inclusive of the Financial VAT charge was 53% for the year compared to 52% in the previous year. 

The overall tax rate of the group inclusive of the Financial VAT charge was 46% as compared with 36% for the previous year. The reduced effective rate of the corresponding period last year was mainly due to the exceptional capital gains made by Capital Development and Investment Company Ltd on the sale of 58.44% of its shareholding in NDB Finance Lanka (Private) Ltd. The effective tax rate excluding  capital gains for the previous year was 51%.

Suntel renews agreement

In today's competitive business landscape it is essential that companies are able to provide customers with superior service that suit their diverse and dynamic requirements. With this vision Sumithra Group has renewed their agreement with Suntel Ltd for a further four years, placing confidence in the telecoms giant's ability to provide them with efficient internal and external communication solutions.

Sumithra Group MD M.A. Jaffer said: "We have been with Suntel since 2002 and it has been a pleasant partnership as both our companies have grown, developing in terms of size and scope as well as success. As we have procured new factories and expanded our offices, Suntel has been able to provide us with telecoms facilities in diverse locations from Wattala to Polgahewala. We are confident that Suntel is the partner that can provide us with the best service and results in the future as well."

Sumithra Garments (Pte) Ltd has gained recognition as a manufacturer and exporter of quality ready made garments to the US, Canadian and European markets. Established in 1984, the company's factories in Sri Lanka have since built up a reputation as a reliable source of supply for internationally renowned brand names

Suntel is a joint venture Company that brings together the resources and expertise of Swedish telecom giant Telecom AB, Metrocorp (Pvt.) Ltd., Townsend Ltd., Hong Kong, NDB Bank and International Finance Corporation (IFC).

CIMASS introduces new project

Kasuni Silva was elected as President CIMA Students' Society (CIMASS) at its 15 Annual General Meeting held recently.

 Dinushika Dissanayake was appointed as the Vice President to assist her with a new committee. CIMASS has a series of events planned for the year, "bigger and better than in previous years in keeping with the CIMASS ideology of continuous improvement. "

CIMASS operates with the key objective of providing its student membership a means of gaining access to knowledge and skills beyond the CIMA curriculum, essential to create a rounded CIMA professional.

CIMASS is in the forefront of grooming future business leaders and have been successful in organizing events of a high calibre that add value to the local student and passed finalist population.  

The Society's first project for the year will be the annual "CIMA Mind Challenge" to be held on  April 27. This business quiz programme attracts a large gathering of over 350 participants representing more than 25 teams from the mercantile sector and CIMA tutoring colleges.

A new project to be launched in July, the CIMA Business Venture (CBV) is a competition which will be created to nurture and give life to seed business ideas of young CIMA Students and passed finalists.  CIMASS recognizes the difficulties involved in launching a successful business venture, however pregnant with possibilities it may be, and hopes to be the connecting factor between venture capitalists and young CIMA entrepreneurs.

Therefore from 2008, CBV will invite participants to think out of the box, create their own "world-class" business idea and bring it to possible investors who will judge and award the best project with the seed money to launch. 

The event is expected to typically attract a viewer-ship of 400 students, passed finalists and business personalities over the rounds and this number is expected to grow. The Business Venture replaces the CIMA Strategic Forum which was a popular competition requiring teams to analyze a real case study and advise a Board on possible courses of action.

Among many other events for the year, included are the regulars: The CIMA Students' Conference in August 2008 and CIMA Social Event in December. The CIMA Sports Event too will make an appearance this year, with a difference.

CIMASS comprises talented young CIMA professionals who strive to maintain high standards and excellence in their endeavours.

1st by Union Assurance

Union Assurance PLC (UAP) launched the first ever integrated and automated facility of issuing motor insurance via the internet.

 The service enables customers to use the internet to buy insurance policies on a 24x7x365day basis.

 The process is simple: What one has to do is to log on "click" on the call & go icon, enter the details, make payment and print the insurance policy.

Senior Manager Market Development Kennedy Michael said that this initiative will give new meaning to convenience when it comes to buying motor insurance. The web is increasingly becoming the popular choice for motor insurance in the West and he believes it will be the same soon in Sri Lanka too, going by the success of e-channelling, e-ticketing and internet banking.

IT General Manager Chandana Jayasooriya says that customers now have another channel open to buy motor insurance policies.System integration has made the process secure and ensures safety of customer information. UAP continues innovations by leveraging on information technology advancements to serve "our customers better," he said.

DTP transactions at KS

Dialog Telekom PLC (DTP) and Keells Super have teamed up to grant Dialog customers a shopping experience by enabling them to make Dialog GSM, CDMA,TV, Broadband and Internet bill payments and Kit eZ Reloads at Keells Super (KS) outlets.

DTP Group Chief  Marketing Officer Nushad Perera said: "At Dialog our focus is our customer and this initiative is a result of our efforts to provide customers with an unparalleled service. We are pleased with this partnership with KS which will increase the levels of convenience for our customers as they will now be able to make Dialog bill payments as well as get Kit eZ reloads at any Keells outlet.

I thank KS, the premier supermarket chain in the country for partnering with us in this endeavour."

JayKay Marketing Services (JMS) CEO Charitha Subasinghe said, "At KS our quest is to add value to our shopper. In that context we are pleased to  partner with Dialog to enable bill settlement for all Dialog services. I am sure many of our customers would benefit because of our association"

KS is operated by JMS, a John Keells Group subsidiary. Since its inception 17 years ago, the chain has grown to 28 outlets and three franchise operations as at now. The chain will open up four more outlets in Mahabage, Attidiya, Peliyagoda and Kurunegala prior to the year end. KS enjoys the distinction of being Sri Lanka's first ever online supermarket. Its interactive website used by local and overseas shoppers  may be used to send gifts and grocery items and also for the shopper who is pressed for time.

ISO for Baurs

The ISO 9001:2000 Quality Management System Certificate was awarded to Baurs' Plant Protection Division for its Agrochemical product range & services recently.

 Baurs ventured into Sri Lanka in 1897 marketing fertilizer. This corporate has come a long way and has since diversified to market Plant Protection Chemicals, Healthcare, Exports, Textile Dyes, Textile Machinery, Travel, Food  Additives, Optics, Airlines, Finance and Information Technology.

The necessity for Baurs to be a part and to support the agriculture development of this country had taken precedence in contributing towards improving the economy.  Focusing this in mind, efforts are being made to market a product which satisfies customers.  The Quality Management System in place would increase efficiency, thus enhancing customer satisfaction.

The Company has employed field staff who are qualified in agriculture and are called upon to work at grassroots level with the farming community. This facility had enabled the farmer to gain technical knowledge in keeping with global innovations and concepts. In pursuit to fall in line with the requirements and expectations of this ISO accreditation body, the company would abide with commitment to legislations enacted locally and internationally. Stringent measures adopted & continuous reviewing sessions would facilitate to maintain quality so that "customers could be kept satisfied with our products and services in keeping with the vision of the company and abiding with ISO 9001: 2000 standards."

Among those associated at this event were Sri Lanka Standards Institute (SLSI) Chairman Dr. A.R.L. Wijesekera, Baurs Director J. Gunasekera and staff of the two organisations. SLSI is the government body representing R.V.A. Netherlands to accredit I.S.O 9001: 2000 Certification in Sri Lanka.

Board appointment

Lalith Withana has joined the Board of Directors of Dankotuwa Porcelain PLC as a non-executive independent director with effect from February 25, 2008.

Withana is a Fellow Member of the Institute of Chartered Accountants of Sri Lanka and of the Chartered Institute of Management Accountants, UK. He also holds an MBA from Sri Jayewardenepura University and a BA [Hon] Degree on Clothing from Manchester Metropolitan University, UK.

Currently Withana is the Executive Vice President at Brandix Lanka Ltd., and responsible for Implementing a new ERP (Enterprise Resource Planning) System (Lawson) across the group, Group Information and Communication Technology (ICT) function and Group process improvement and business solutions.

Relationships, way forward

The first in a series of evening meetings organized by The Management Club (TMC) for members and their guests was held recently at Galle Face Hotel.The guest speaker for the evening was Hatton National Bank chairman Rienzie Wijetilleke.

Speaking on the way forward for the country in general and business establishments in particular under prevalent economic conditions, he drew examples from his experiences and was emphatic on how an organization does not progress only by the work it does, but on relationships, not only qualifications that matters but performance, not the people, but how the right people can bring about a change for the better.

Comparing situations then and now he pointed out that unlike in a bygone era where people chose to rise in their careers step by step, youth of today who were ambitious, dream of becoming leaders overnight. With a greater risk factor, it is a few who may be successful and reach the top in this manner. He quoted, 'Leaders will only develop leaders and not followers.'

The session was well attended by professionals and executives in different fields and TMC is hopeful of having similar evening meetings each month on varied topics which will bring together a cross section of managers to interact and network with one another and share the knowledge and experiences of versatile speakers.

SLT invests Rs. 100 mn., in IPTV

Sri Lanka Telecom PLC (SLT) last month (February) floated a wholly owned subsidiary called SLT Visioncom (Pvt.) Ltd., to undertake provisioning of internet based television services to its broadband customers.

Total investment on this project is Rs. 100 million.

By the deployment of IPTV, SLT expects to optimize the use of its existing broadband access networks. IPTV is viewed as a value added service with strategic importance in SLT's future broadband service portfolio, SLT CEO Shoji Takahashi in a letter to the Colombo Stock Exchange said.