DFCC, Vardhana apply to CB for merger

DFCC Bank is to merge with its subsidiary DFCC Vardhana Bank (DVB), the two entities said in a joint filing to the Colombo Stock Exchange (CSE).

The Board of Directors of DFCC and DVB have decided that it would be in the best interests of both banks, its shareholders and other stake holders to amalgamate DFCC and its 99.2%-owned subsidiary, DVB, to continue their activities as a single legal entity, which is a licensed commercial bank.

Accordingly the banks have made an application to the Central Bank seeking provisional approval of a merger.

“Upon receiving the approval of the Central Bank in principal, the banks will embark on the steps that have to be taken to complete this amalgamation and submit the amalgamation proposal for the approval of the shareholders of the two banks as required by the Companies Act,” the DFCC said in the statement.

The amalgamation will only be effective after all required regulatory and shareholder approvals of received.

The latest announcement follows DFCC and NDB recently deciding to terminate the Memorandum of Understanding to explore an amalgamation of DFCC, Vardhana and NDB.