Blunderings delay advisory removals
Emergency regulations and Government of
Sri Lanka’s (G.o.S.L.’s) diplomatic blunderings have
made it difficult to get the West to remove its travel
advisories on the island.
At a ceremony held to mark the
rebranding of Sri Lanka Tourism (S.L.T.) On Tuesday,
President Mahinda Rajapaksa appealed for the removal of
those advisories on the grounds that the war is over.
A Sri Lanka Tourism Promotion Bureau (S.L.T.P.B.)
source told The Sunday Leader that though
G.o.S.L.’s firmness in dealing with the terrorist issue
despite international pressure needs to be commended, he
however said that it could have had been handled more
He said that G.o.S.L. should have had
been more judicious in dealing with the West on this
issue, as it was not only Sri Lanka’s biggest tourism
market, but it was also the country’s biggest export
Developing countries such as India and
China, which are much bigger than Sri Lanka in so many
ways, are however more diplomatic in dealing with the
West on controversial issues involving their countries,
the source claimed.
Deputy Tourism Minister Faiszer
Musthapha speaking to reporters said that they were
working to get those travel advisories removed, but was
unable to give a timeframe as to when this would happen.
Travel advisories include warnings to
its citizens of the danger to life and limb of visiting
a particular country or certain parts or part of it.
Such advisories also cause travel insurance premiums to
Travel advisories on Sri Lanka has
mainly emanated from the West, Sri Lanka’s key tourism
market, after the July ’83 riots that resulted in the
L.T.T.E. launching guerilla attacks and exploding bombs
in the south of the country.
However, though the war with the
terrorists was over a month ago, those advisories still
persist. The conduct of the war has irked several
Western governments including the U.S.A. and U.K., the
country’s two biggest export markets. U.K. is also Sri
Lanka’s second biggest tourism generating market, and
there is thinking in Colombo that it’s because of this
that the West has been slow in removing such advisories.
S.L.T.P.B. Chairman Bernard Goonetilleke
refused to comment when this reporter recently asked him
whether the West, persisting with their travel
advisories, despite the fact that the war is now over,
was a means of resorting to economic terrorism on the
The delay in Sri Lanka obtaining the
U.S.$ 1.9 billion standby facility from the I.M.F.,
where the West commands tremendous clout with this
lending agency, is also directly linked to this
acrimony. The West has also imposed aid cuts on Colombo
due to alleged human rights abuse.
S.L.T.P.B. is at present on a campaign
of meeting diplomatic heads of Western missions here in
order to get those travel advisories removed.
It’s learnt that though their meeting
with the U.K. High Commissioner met with a non committal
response, their meetings however with the ambassadors of
France and Italy were positive. These two markets at one
time generated a good number of tourists to the island.
The aforesaid three European countries
as well as Germany, Sri Lanka’s third biggest tourism
generating market, are among the European countries that
have issued travel advisories on Sri Lanka.
Meanwhile S.L.T.P.B. has delayed their
visit to the German mission in Colombo as it’s without
an ambassador at present, with the previous envoy,
having had completed his term, leaving the country.
S.L.T.P.B. plans to meet the new envoy
after he takes office.
The previous envoy in Colombo did not
see eye to eye with the authorities here on alleged
human rights abuse.
"It’s better to meet the new envoy than
the acting head, as the latter may have had been
prejudiced by the previous ambassador," a source said.
Pay cuts, no pay, at SriLankan
SriLankan Airlines, on top of the one
year voluntary no pay leave offered to its employees,
has also made an offer to its senior management to take
a day or two days pay cut a month, an official told
The Sunday Leader.
The company has some 5,000 employees.
Manoj Gunawardena, C.E.O. SriLankan
Airlines said that he also comes under this bracket. He
said that if 60% of the senior staff agree for this cut,
it could be pushed through. In a circular to staff,
Gunewardena said that these measures would result in a
Rs. one billion cost saving to the airline.
These will be reviewed in March next
year and if things turn for the better, the staff would
be reimbursed, he told this reporter.
Gunewardena said that the recession
together with competition had adversely affected
pricings, with some sectors, such as the Colombo-London
sector taking a 35% pricing cut to Rs. 65,000 a ticket.
Those had adversely impacted on the national carrier’s
profitability. He however expected things to look better
this coming winter.
Gunawardena said that previously the
airline was impacted by rising oil prices, but now it
were price competition and falling demand, especially
from the fourth quarter ended March 31, 2009 that was
impacting it. He said that their audited results for the
financial year ended March 31, 2009 was not yet ready,
but did not expect them to look good.
The company made a Rs. 5.8 billion loss
in the first quarter ended June 2008 in the 2008/09
financial year according to Gunawardena’s staff
"But just as things began to look good,
a fresh challenge loomed. The global economic crisis is
now upon us. And it has already caused an adverse impact
on global travel. It hit us in February 2009 and our
passenger sales have been hit hard since then. We now
expect a loss rather than breaking even in our fourth
quarter (January to March 2009). This setback our
performance for the financial year 2008/09. As it
stands, the best projections for 2009/10 predict a
deficit that is the same as last financial year. But
last year’s deficit was due mainly to high fuel costs.
Having a similar deficit this year is simply not good
enough," the circular further said. Gunawardena however
said that despite adversity, they were currently
carrying a 75% load factor on all the sectors that they
Rooms for 650,000 tourists
Sri Lanka currently has 15,000 guest
rooms that work out to being able to take upto 650,000
tourists annually. The industry targets to bring in 2.5
million tourists by 2016 now that the war is over.
Currently tourist arrivals hinge between 400,000-500,000
n.p.l.s to rise
Banks’ bad loans are increasing as a
result of falling exports that are hitting export
industries, compounded by a rise in credit cards
defaults, but at the same time the bourse is on a bull
run (though it was seemingly faltering last week).
This is a paradoxical situation.
The over-arching problem here is that
the Government of Sri Lanka (G.o.S.L.) is broke and to
make matters worse, G.o.S.L. revenues are falling,
whilst at the same time its debt is rising, resulting in
a worsening economic scenario.
Sri Lanka needs outside assistance to
bail it out in the worsening economic scenario.
In this connection, Central Bank of Sri
Lanka’s (C.B.S.L.’s) much talked of I.M.F.’s U.S.$ 1.9
billion standby arrangement is yet to see the light of
day, though they have been talking about it from around
three months ago, since March of this year to be
precise, but not even a cent has been received thus far.
And now, in an apparent case of sour
grapes, C.B.S.L., on the back of some U.S.$ 190 million
received in investments in Treasury bills outstanding
after the end of the terrorist war last month says that
the country can do without any I.M.F. money.
Whether that is an irresponsible
statement to make only time will tell.
Undoubtedly C.B.S.L. Governor Ajith
Nivard Cabraal is banking on the war win, after 26 years
of suffering, that this change for the better that the
island is now experiencing would also strengthen its
The bourse, in sporadic instances is now
experiencing net foreign inflows, though Sri Lanka born,
but U.S. based Raj Rajaratnam, who manages several
foreign funds has been on the selling side, which
translates to foreign outflows, thereby causing a hit in
the country’s already depleted reserves.
How be it, bolstering of foreign inflows
into the stock market has largely been due to the entry
of two new funds, one U.S. and the other U.K., after the
Now that peace has dawned in the
country, hopefully other funds too will follow, keeping
up the bourse’s bull run and making portfolio investors
Nevertheless, according to banking
industry sources, signs are that the banks’ non
performing loans (n.p.l.s) will continue to rise,
despite the seeming good times ahead for the country.
Banks’ n.p.l.s in the three month period
from December 31, 2008 to March 31, 2009 rose by 25%,
from Rs. 100 billion to Rs. 125 billion, constituting
7.2% of the banks’ total loan portfolio, up from the
earlier 5% as at December 31, 2008.
Among the other reasons adduced to the
rise in n.p.l.s is the collapse of unregulated finance
companies like Golden Key. Golden Key alone used to
disburse around Rs. one billion monthly as interest
payments to its depositors. This money, according to Sri
Lanka Banks’ Association Secretary General Upali de
Silva was used to settle housing loans taken by those
depositors’ from banks.
But now that source of income is not
there, hence the rise in housing loan defaults, which as
a consequence contributes to a rise in banks’ n.p.l.s.
One way of mitigating this problem is by
lowering lending rates, which the C.B.S.L. is trying to
do, by cutting its policy rates, the rate at which it
lends to banks, which is now down to 11%, with the
latest rate cut of 50 basis points (b.p.s) announced at
this month’s monetary policy statement, however being
still high, when compared to central banks in developed
countries virtually giving credit free to their banks,
translating to our own C.B.S.L.’s overnight lending rate
(policy rate) being still 1,100 b.p.s higher than its
counterparts’ in the developed world’s lending rates.
Local banks say that once they reduce
their deposit rates, the reduction in lending rates too
will follow. A banker from D.F.C.C. Bank speaking at a
seminar recently, where this reporter too was present,
said that their lending rates to a developed industry
such as the mini hydro industry was as high as 25% last
year. He however said that a silver lining is that rates
are now coming down.
If, its lending rate to a developed
industry such as mini hydros was as high as 25%, one may
only shudder to think at what rates they lent to the
other seemingly not so viable industries and to
But hopefully a start has been made, and
a key to its continuation, of making rates still lower
is to contain inflation, a step which C.B.S.L. is taking
through its open market operations that mops up excess
liquidity in the system.
But what is the position of depositors
in companies like Golden Key who have had their entire
savings wiped out and thus are unable to service their
bank loans? Two problems crop up here: Rise in banks
n.p.l.s and a part of the country’s citizens being made
Banks may have recourse to seizing the
asset, in this instance the house or the property as a
means to recover the outstanding loan, but such an
action may result in the loan defaulter and his family
being virtually thrown out into the streets in extreme
cases, causing a social problem.
As such G.o.S.L. assistance may be
needed to reschedule such loans, and/or to find
alternate accommodations to such peoples whose houses
and properties may be repossessed by banks in lieu of
The other problem is to try to find a
panacea for bad loans caused by the collapse of export
industries due to the global recession. Repossession
here may not be the perfect solution as those industries
are job creators, and repossession of such industries
may result in jobs destruction, causing an even bigger
social problem than the repossessing of houses and
properties of loan defaulters.
Hereto G.o.S.L/ C.B.S.L. assistance may
be needed to help banks to reschedule such loans. But
where is the money is the million dollar, or more
correctly the billion dollar question is the issue.
And, like the sword of Damocles, the
U.S.$ 800 million hedging bill that is now before
arbitration, and feeding, clothing, sheltering,
resettling and livelihood restoration of some 300,000
I.D.P.s in the North are the other pressing problems
confronting the G.o.S.L. and the country despite the war
Sri Lanka National Arbitration Centre (SLNAC)
members include Romesh de Silva (PC)-Chairman, H.E.P.
Cooray, Nimal Weeraratne and Kandiah Neelakandan
(lawyers), Hiran de Alwis (Hony. C.E.O./Legal Adviser),
Nimal Perera (Ceylon National Chamber of Industries),
Jayasiri Samaratunga (National Construction Contractors
Association of Sri Lanka), Ms. Pansy Joseph (Bar
Association of Sri Lanka), Sujiva Samaraweera (National
Chamber of Commerce of Sri Lanka), Mrs. Ranee Ratnayake
(Women’s Chamber of Industry & Commerce), U.W.Rodrigo
(Institute of Construction Training & Development), Mrs.
Sarojini Dunuwila (Sri Lanka Banks Association (Gte)
Ltd.), Prof. Chithra Wedikkara (architect/quantity
surveyor), G.S. Chatoor(Ceylon Chamber of Commerce),
Ziqufi Ismail (Sri Lanka Gem & Jewellery Association),
Ranjan Nadesapillai (Sri Lanka Institute of Architects),
H.D.Chandrasena ((Sri Lanka Institute of Quantity
Surveyors), S.T.S. Arulananthan (Ceylon Hardware
Merchants Association) and Dakshitha Thalgodapitiya (Sri
Lanka Chamber of Construction Industry). On an average
the Centre conducts 20 arbitration sittings weekly.
SLNAC also has agreements with several international
Growing in hostile conditions
LB Finance Plc, in the financial year (f.y.)
ended March 31, 2009 saw gross income rise by 28.8% year
on year (Y.o.Y.) to Rs. 3.6 billion, net profit before
income tax by 56.3% Y.o.Y. to Rs. 555.3 million and net
profit by 74.7% Y.o.Y. to Rs. 359.6 million.
The company’s chairman B.M. Amarasekera
in his statement to shareholders said that the past year
had proved to be one of the most challenging in the
history of LB Finance, with several macroeconomic shocks
that impacted on the business and on the financial
services industry as a whole.
Managing Director Sumith Adihetty in his
review said that it was another successful year for LB
Finance despite difficulties in the macroeconomic
environment. "Interest rates were high despite a slight
reduction towards the latter part of the year which
increased our cost of funds. Rising oil prices and fuel
costs put pressure on collections and the collapse of
unauthorized financial institutions in the recent past
resulted in investor confidence in finance companies
being shaken. However, I’m proud to report that this
year there has seen a remarkable increase in both
company revenue and profits, making the year under
review the fifth consecutive year that we have grown in
revenues and profits," he said.
"The solid performance during the year
under review is testimony to us being proactive, given
challenging market conditions, the strong strategic
foundation that we have laid during the past few years,
the innovative approach to business and most
importantly, getting the basics right," Adihetty said.
"We continued to strengthen our asset
quality and placed great emphasis on credit and asset
management given the prevailing economic conditions
during the year.
10 year bond issued after six year lapse
The government after a lapse of six
years issued a 10 year maturing Treasury (T) bond to the
market at Tuesday’s primary auction which fetched a
weighted average yield (w.a.y.) of 13.47%, 672 basis
points (b.p.s) more than the 6.75% w.a.y. fetched at the
2003 primary auction, market sources told The Sunday
"When there was only a ceasefire such
bonds fetched a low yield of 6.75%, but now, where there
is seemingly permanent peace with the war coming to an
end, a bond of a similar 10 year tenure fetched a w.a.y.
that was 672 basis points more than the 2003 10 year
bond. One may interpret this to investor confidence
still lacking in the market, but on the other hand, it
may be a good buy, with the environment developing into
a falling interest rate scenario, thereby creating an
active sellers’ market for such bonds," the sources
It’s likely that the Central Bank of Sri
Lanka (C.B.S.L.) may issue several such bonds of similar
tenures in the not too distant future, they said.
However, though Tuesday’s tender
originally had an offer for sale Rs. 500 million worth
of such bonds, what was ultimately sold to the market
was a mere Rs. 150 million.
"C.B.S.L. probably wanted to develop a
yield curve, the present yield curve is only for 10
years, whereas in more developed markets they have yield
curves spanning a period of 30 years, " the sources
said. "It’s possible that the reason why C.B.S.L. sold a
lesser amount may be due to the fact that the market was
asking for a higher yield for the remainder," they said.
Meanwhile, T bonds of a five year
maturity were trading at the 13% levels at Tuesday’s
secondary market trading.
Other bonds that were offered at
Tuesday’s primary auction were T bonds of 2013 maturity
which fetched a w.a.y. of 12.96% in line with secondary
market trading for this tenure and 13.07% for T. bonds
of 2015 maturity, which maturities however hardly
attracted any trading in the secondary market.
C.B.S.L.’s offer of a parcel of Rs. 500
million worth of T bonds of 2013 maturity at this
auction was fully subscribed by the market, while in the
case of the 2015 maturity, though Rs. 500 million was
originally offered, C.B.S.L. allowed the market to
subscribe to only Rs. 450 million worth of bonds of this
Meanwhile C.B.S.L. through its agent the
Bank of Ceylon continued to defend the U. S. dollar at
the Rs. 114.90 levels, by offering to buy the same at
those prices, thereby preventing the greenback from
depreciating below those levels.
Greed, cause for chicken shortage
An alleged racket involving poultry
producers and middlemen has caused the current shortage
in poultry meat, market sources said.
Maize farmers had had entered into
agreements with poultry farmers to sell them a kilo of
maize at Rs. 27. The imported maize due to the
government’s duty component was around Rs. 47-48 a kg.
This duty component was to protect the
local maize industry. Maize is an essential ingredient
for poultry feed.
The middleman had then persuaded the
maize farmer to increase his price to the poultry farmer
to be almost commensurate with the imported price of
maize, thereby disrupting the market, the sources said.
They further said that these buy back
arrangements between the poultry farmer and the maize
farmer were loose arrangements, allowing one to renege
the other and vice versa, without fear of the "loser"
hauling the other to courts as those were not firm
They also alleged that the current
maximum retail price (m.r.p.) of poultry meat at Rs. 320
a kilo was unrealistic, adding that one supplier had had
even made an offer to sell those at Rs. 290 a kg.
However, poultry farmers want the retail
price of poultry meat increased from the current Rs. 320
a kg., on the grounds that the cost of production has
gone up. But the government has refused to increase the
m.r.p. of poultry meat.
Sources said that poultry farmers, some
of whom act as outgrowers to a multi-national company (m.n.c.)
with this m.n.c. itself being a key poultry meat
supplier to the market, had also allegedly reneged on
their contracts with local maize farmers and had
imported the "cheaper sorghum" as a substitute recently,
instead of buying the local farmers maize.
The government having had got wind of
this had then banned or increased the duties on sorghum,
thereby making it uncompetitive for poultry farmers to
import this pulse.
This is the apparent reason for the
shortage of poultry meat in the market, the sources
said, adding that poultry farmers say that buying maize
from the local producer is too expensive, and as such an
agitation for an upward revision of the m.r.p.
"However, the irony is that a few months
ago poultry farmers had allegedly told the government
that the market was in excess of 100,000 kg. of poultry
meat and had wanted it to facilitate the export of this
excess to India," the sources said.
The government agreed, but nothing came
out of this venture as the suppliers backed out.
They further said that a reason for
imported pulses like sorghum and maize to be cheap
compared with the locally produced maize was because Sri
Lanka’s farm labour was higher than that of competitor
countries such as Vietnam and China.
They however alleged that the m.n.c. in
the local poultry market had invested in such
agriculture farmland in countries like Vietnam and
China, making it cheaper for it to import such feed from
those countries and supply the same to the poultry
industry here, rather than buy such feed from the Sri
Lankan maize farmer.
Sinhaputhra looks N.E.
Sinhaputhra Finance Ltd Chairman and
Managing Director Ravana Wijeyeratne said that the
changes in confidence level in banking and finance has
been felt throughout the industry and positive vibes are
It has materialized in way of deposits
inflows and soon the entire sector would be at full
steam. Sinhaputhra along with many of its peers are
looking north and eastwards to make early inroads. He
holds a strong view that a healthy rapport and sharing
of vital information between the regulated finance and
banking houses along with healthy competition amidst
them is of final benefit to all concerned, whilst the
reverse is a detriment to all.
Wijeyeratne attributed the recent
failure and losses in confidence levels to the stubborn
non-conformity to accepted standards set out by
regulating authorities by both "giants" as well as a few
others, the delayed and ineffective actions towards the
informal financial markets and the absence of the role
of a truly independent auditor as factors, moreso than
the global financial crisis.
He said that although the global crisis
has had its share, "that had we as a nation addressed
key issues early, we could have been at an extremely
advantageous situation to ‘leap frog’ ahead of other
nations and capitalize. This Wijeyeratne said is a
lesson well learned, for it weaned out the weak, at
times troubled even the best, but it kept afloat the
stable towards reaching a safer haven for all savers and
depositors. With the possibility of an FD insurance
scheme being established, the confidence levels will
only further increase.
Sinhaputhra, now in its 30th year of
operations and celebrating its Pearl anniversary,
reported that their depositors were rewarded at premium
rates in the year ended March 31, 2009, and continued to
benefit them with attractive rates even during the
ensuing year. In the financial year ended March 31,
2009, the company paid our Rs. 412 million as interest
benefits to its depositors.
The company encourages monthly interest
earning deposits to ensure that depositors reap
immediate benefit of their investments and to encourage
the company to engage in monthly income generating
investments such as Pawning, Leasing, Hire Purchase and
asset backed loans. The company’s expertise in these
areas have ensured healthy profits that have augmented
its capital base to over Rs. 400 million. "The nature of
our business restricts the company in engaging in longer
term investments where income generation occurs after a
time lapse," said DGM Operations Saliya De Alwis. As a
key point, the company ensured much caution in
investments in real estate and housing during the recent
past, thus a pitfall was well avoided by Sinhaputhra
With positive confidence levels, the
industry has felt the need to lower interest rates
offered to depositors as a result of the easing of the
liquidity situation. In any event as statutorily
required by the regulatory body, Central Bank’s non bank
supervision department, all registered finance companies
(RFCs) have to fall within interest rate ceilings based
on Treasury bill rates. There has been an impressive
reduction in treasury bills, which augurs well for
investing but less advantageous to savers. Therefore,
effective July 1, 2009, most RFCs in Sri Lanka will be
offering considerably lower interest rates. Investment
Promotions Consultant Michael Cooke add that certain
depositors who have thought wisely have locked in their
funds for longer terms thus not being affected by the
rate fall. AGM Risk and IT Pandula Aluwihare pointed out
that RFCs as a sector holds on to the least risk arising
asset bases such as Gold and vehicle stocks which are
either in their direct custody or can be taken in at
points of default. Companies that have been in operation
for many years have recovery processes and methods well
adapted to meet challenging situations which they would
have learnt from 1987-88, height of the LTTE activities
and in the early months of this year.
Low exposure to the housing and real
estate market, credit cards, loans and business
overdraft accounts were all positive factors to ensure
risk mitigation and liquidity at a time that this was
paramount. Sinhaputhra has been proud to engage itself
in a variety of CSR efforts ranging from eye care, blood
donation and health camps, donations to the Sri Lanka
Army and Kandy General Hospital, Supplies to IDP camps
and several others. AGM Administration and Establishment
Mrs. Susan Gunawardena said that all these allows our
employees to remain conscious and sensitive to those who
are in need, and she noted the enthusiasm amonst the
staff to partake of these projects.
Vallibel’s profits up 164%
Vallibel Finance, the newest financial
entity born to the renowned Vallibel Group, recently
completed two triumphant years in the industry; success
has thus far partnered every venture of the Vallibel
Group, and Vallibel Finance too seem to have followed
course as seen by results posted for the year ended
Achieving an overall growth in terms of
assets, profit, income and customer deposits in spite of
challenging economic times and multi-dimensional
competition, Vallibel Finance is reported to have made
the Group’s vision of bringing in a robust new player
into the financial sphere come true.
During the concluded financial year, the
Company achieved a significant 57% increase of Rs.1.55Bn
in its asset portfolio comprising hire purchase and
leases. Maintaining its growth momentum the Company was
also successful in bringing down its Non-Performing
Loans (NPL) to a healthy 3.51% which is lower than the
7% industry average. This was due to prudent and
pragmatic credit evaluation and effective recovery
processes set in place.
Vallibel Finance’s gross interest income
of Rs.119 mn. in financial year 2007/08 grew by an
impressive Rs.357 mn., which is a 198% increase. Company
gross profits too followed course, recording a Rs.146 mn.
growth, up by 164% over last year’s profit of Rs.55.6 mn.
Although the past year was a testing one
for the country’s financial sphere and financial
entities were regarded with mistrust, Vallibel continued
to successfully draw in investor deposits even amidst
economic turmoil; Company deposit collection increased
by 73%, from Rs.473 mn. to Rs.820 mn. during the year.
Customers continued to place their trust in the Vallibel
name, robust start and the momentum that followed
course, which it has been successful in maintaining
Let market decide
More undergraduates mean more
unemployment, a World Bank (W.B.) education specialist
replying to a question raised by a reporter said.
Benoit Millot, Leader Education
Specialist, W.B., speaking to reporters on Wednesday on
the question of what the W.B. is doing to help more
eligible students to get into the local varsity system
then asked, "who is going to bear the cost for
He said that the State has a budgetary
problem in funding education.
"The market will decide whether you
should get a job or not, and not just because you have a
graduate degree," said Millot.
"But in this country the State recruits
graduates, it does not make economic sense," he said.
No tourists for
The Nuwara Perahera which begins next
month and which in the past attracted several tourists
to the island, will be below par this year as far as
foreign visitors are concerned, an industry source told
The Sunday Leader.
Chandra Wickramasinghe, President, Sri
Lanka Association of Inbound Tour Operators (S.L.A.I.T.O.)
alleged that the travel advisories, a thorn in the flesh
as far as the local tourism industry is concerned, cover
only the North and East and North of Anuradhapura, along
the A 9 highway, and as such was not a problem to the
industry. One operator plans to bring 600 tourists from
the West in October. He said that the tour operators in
the West are also not happy with these advisories. "When
outbound travel from their countries to Sri Lanka has
fallen steeply due to those advisories, they too cannot
be happy as it hurts their income," Wickramasinghe said.
He also said that Germany in their travel advisory had
informed that the "war is over," which is positive from
an industry viewpoint. That advisory had however warned
of travelling by public transport, said Wickramasinghe.
The terrorists, at the height of their
activities, used to plant bombs in buses and trains and
have also attacked the same. Meanwhile S.L.T.P.B.
Chairman Bernard Goonetilleke told this reporter
recently that the U.K.’s travel advisory even warns its
citizens not to travel to Yala and the Cultural
Triangle, two tourism hotspots. Anuradhapura is located
in the Cultural Triangle.
Textiles and garments earnings declined
by 10.1% year on year to US$ 227 million in April 2009.
Despite industry confidence expressed of having
confirmed orders, some orders were cancelled or
postponed amidst uncertainties about the strength and
duration of the global economic downturn. Demand from
E.U. declined by 17.6% to US$ 103 million while demand
from U.S.A. picked up by 4.4% to US$ 103 million in
April 2009. Cumulative export earnings declined by 16.2%
to US$ 2,085 million. (Source: Central Bank)
Reduced to Rs. 3
Central Bank of Sri Lanka (C.B.S.L.) in
a stock exchange filing on Friday said that it has
decided not to accept the bid (Rs. 5.7 bn.) made by the
strategic investor (L.O.L.C.) for Seylan Bank.
It said that the Monetary Board (M.B.)
has concluded that the offer has not fulfilled
C.B.S.L.’s parameters in relation to ownership limits.
M.B. has now directed Seylan to issue an appropriate
number of voting shares to generate a capital infusion
of Rs, three billion by end August 2009. In addition
Seylan will be required to invite investments from a few
state institutions so that such institutions could
collectively invest in 33% of the Bank’s ordinary
shares. Seylan has 43.56 milion voting shares with share
value ranging from Rs. 33-38 a share.
To HNB Board
Hatton National Bank Board has appointed
N. G. (Tanky) Wickremaratne as an Independent Non
Executive Director with effect from July 1, 2009.
Wickremaratne is the Chairman and Chief
Executive Officer of the blue chip Hayleys Group.
A key achievement in his career had been
the founding of Dipped Products Ltd. a company within
the Hayleys Group manufacturing rubber gloves, of which
he had been the CEO from its inception in 1976 and
Managing Director from 1983 to 2006.
An old boy of S. Thomas’ College, Mount
Lavinia, Wickremaratne holds a Bachelor of Science
Degree from Peradeniya University.
Sri Lanka Tourism on Tuesday rebranded
itself under the tag line "Sri Lanka small miracle,"
replacing the earlier tag line, "Sri Lanka land like no
E.o.i.s for oil
Cairn India, an oil exploratory firm,
which obtained a contract to explore for oil off the
shores of Mannar after paying the Government of Sri
Lanka (G.o.S.L.) U.S.$ one million, has called for
expressions of interest (e.o.i.) from parties to take
three dimensional (3D) surveys in the allocated region.
Adjacent to the Mannar basin (allocated
to Cairns for oil exploration) lies the Caveri basin
that comes under the jurisdiction of India, where the
Indians have struck oil.
E.o.i.s close in August/September, with
3D surveys expected to be ready by April 2010.
The area allocated to Cairns comprises
3,000 square kilometres, with depths ranging from a
minimum of 200 metres and upwards.
Cairn which has committed a total of
U.S. $ 110 million on this project, will also have to
pay royalties to G.o.S.L. in the event they strike oil.
Rs. 1 bn.
Central Bank of Sri Lanka (C.B.S.L.) on
Thursday called for a reverse auction to buy back Rs. 1
billion of 07.60% (coupon rate )2009A Treasury bond from
the market. The bond matures on August 1.
It was issued on August 1, 2003.
This auction is planned for tomorrow
with settlement on Wednesday.
Market sources said that this action by
C.B.S.L. is to inject liquidity into the market in order
to bring rates down.
brings down rates
Backed by U.S. dollar inflows that has
made the market liquid, Wednesday’s Treasury (T) bill
primary auction saw the weighted average yield (w.a.y.)
of 182 day T bill fall sharply by 53 basis points (b.p.s)
to 12.03% week on week, while that of 91 and 364 day T
bills fell by 15 and 26 b.p.s. to 11.41% and 12.34%
respectively at this auction.
However, at Thursday’s secondary market
trading 2013 maturing T bonds rose by 10-15 b.p.s. to
13.10% and those of August-December 2010 maturing bonds
by 20 b.p.s. to 12.70% over that of Wednesday’s close,
when in fact its commensurate 364 day maturity T bill
fetched a w.a.y. of 12.34% at Wednesday’s T bill
Market sources however, attributed these
rises to profit taking, which in turn would have had
caused selling pressure, causing yields to go up in
secondary market trading.
They deemed this rise temporary.
Rs. 1 mn.
Dr. (Ms). Hettiarachchi, J. C.
Attanayake and Buddhika Dissanayake were selected
‘Winner’, ‘1st Runner Up’ and ‘2nd Runner Up’
respectively‘ in the Kalutara District Caltex Road
Stars’ competition held recently.
They were presented with insurance
policies and hotel/discount vouchers by Chevron
Lubricants Lanka Plc Managing Director/ CEO Kishu Gomes.
The winner was awarded an insurance policy to the value
of Rs. one million.
Sri Lanka Association of Inbound Tour
Operators (SLAITO) has requested their foreign
counterparts to urge their governments to relax travel
advisories on Sri Lanka with the war coming to an end,
SLAITO President Chandra Wickramesinghe told The
"SLAITO membership handles 90% of
inbound tours and foreign tour operators have now
decided to include the destination in their broachers
which is encouraging," he claimed.
"We are planning to bring down tour
operators where we could show them the ground situation.
Once they discover that Sri Lanka is a safe destination
they would take that message to their countries and it
would help to get the advisories relaxed,"
Wickramesinghe said. (N.K.)
World Bank’s (W.B.’s) new country
assistance strategy (c.a.s.) has a U.S.$ 40 million
component for the development of the country’s higher
(tertiary) education sector.
C.a.s., which is U.S.$ 900 million in
total value, is spread over four years beginning from
this year. W.B. Team Leader Dr. Harsha Aturupane told
reporters on Wednesday that the programme will kick off
on June 30 of next year after the completion of the
existing "improving the relevance and quality of
undergraduate education" (i.r.q.u.e.) project, coming
under the W.B.’s previous c.a.s. programme.
A feature of the new programme is that
it has a component on English education beginning from
year one to the final year in universities.
The programme also includes government
education institutions offering the H.N.D.E.
qualification under the Sri Lanka Institute for Advanced
Technological Education, a vocational training
institute. English education under the i.r.q.u.e.
project was limited to final year undergraduates, said
Aturupane. The new c.a.s. cuts across all university
streams, including Arts and Humanities. It also has an
I.T. education component and train the teacher programme,
as a number of teachers are poor in English.
Universities under the University Grants Commission will
have to compete for funding, with the exception being
those universities in the North and East which have been
affected by the war.
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