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Now
Asian Finance playing truant
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Lalith Kotelawala |
By Dilrukshi Handunnetti
Hot on
the heels of The Finance Company Plc denying depositors
their right to withdraw cash deposits at maturity, yet
another Ceylinco company has halted the payment of
interest to depositors who hold preferential shares.
Asian
Finance Ltd, yet another Ceylinco subsidiary and a
registered financial company has begun to offer
depositors an excuse that is now triggering off a very
emotional reaction — of having tremendously suffered
financially the previous year and being unable to pay
dividends.
Yet,
several depositors who spoke to The Sunday Leader said
that while they have been paid their monthly interest
payments up to June, the company has refused to pay the
annual interest on preference shares due in March this
year.
Depositors naturally feel that with the crumbling of the
Ceylinco empire like a pack of cards, other key Ceylinco
subsidiaries too may be now resorting to hoodwink
depositors in various ways including the offering of
excuses.
Dividends cannot be paid
An
angry depositor from Katugastota, Judith Werkmeister has
in writing complained to the relevant authorities that
she and her husband, both retired from the private
sector were dependent on their monthly and annual
interest on investments made with Asian Finance Ltd and
were now being completely disappointed by the callous
treatment meted out to them, trusted customers of the
company.
A
letter sent by Werkmeister states that ‘after numerous
telephone calls my husband was able to contact General
Manager Asian Finance Ltd. only to be told “dividends
cannot be paid because the company suffered a loss for
the last financial year.”
Speaking to The Sunday Leader, a depositor who did not
wish to be named said that the excuse of suffering
financial loss last year was completely unacceptable.
“Every conceivable company, whether part of the Ceylinco
Group or not would have anyway suffered from the global
economic meltdown and this situation was not unique to
Asian Finance Ltd.”
Then
there are others like Tissa Gunaruwan, another angry
depositor who alleged there was no need to make such
excuses for non-payment of dividends.
“The
interest rates on preference shares are pre-determined
and they are not dividends dependent on profits or
losses suffered by the company.”
Other
angry depositors, including Sharmini Thevanayagam and
Dasun Perera, told The Sunday Leader that they simply
fail to understand the logic behind the refusal to pay
annual interest on matured deposits.
Another scam
“ I
think it is yet another Ceylinco style scam. They have
been paying the monthly interest. But what’s the point
when every Ceylinco subsidiary appears to be looking for
ways to not pay their depositors,” they claimed.
In the
meantime, CEO of the company, Douglas Weerasinghe has
vacated office and a replacement has not yet been found,
further complicating matters as depositors clamour for
relief. Weerasinghe was appointed by the Lankaputra Bank
which was expected to oversee the functions of Asian
Finance.
“This
is outrageous. They expect depositors to remain calm and
quiet until they think it is suitable for them to
honour a payment scheme both parties agreed on. In the
present backdrop, a sane depositor will not allow any
finance company to take any liberties or offer alternate
schemes of payment. It is incredible that they expect us
to forgo interest etc. simply until they get their act
together,” another angry depositor told The Sunday
Leader.
No reason to delay payment
Depositors also claim that as interest rates were fixed
with regard to preference shares in similar vein to
fixed deposits, and hence there was no reason to delay
payment.
Further, they claim that some of them have been told
that fixed interest rates payable annually on March 31
may be delayed due to a possible amalgamation with
Ceylinco Finance Ltd, a plan that has been in the
pipeline for a while now.
Some
of the investors were in writing requested to surrender
their original share certificates to enable the company
to refund their capital and accrued interest within
seven days of the amalgamation. This amalgamation is yet
to take place.
Further they say that there is no condition whatsoever
to adduce that dividends would be based on profits and
that no payment of interest would be made if the company
suffers any loss.
General Manager, Asian Finance Ltd, M.S. Dalugoda told
The Sunday Leader that the total value of preference
shares were around Rs. 25 million and they are
redeemable.
“But
there is a small crisis situation and in fact, there are
legal provisions that could be used to withhold
payments, but that’s not what we wish to do. Given the
tricky situation we are in, we cannot pay dividends
right now but we are trying our best to do justice to
our depositors,” Dalugoda said.
He said every effort was being made to offer relief and
promised a more comprehensive answer to the questions
with regard to those holding preferential shares. “I am
on the verge of writing to the Central Bank in order to
offer some solution to this special category of
depositors. Other categories have been sorted out. There
are only a few preferential shareholders but they have a
natural cause for grievance. I am hopeful the problem
can be solved shortly,” he added. |
