Friday Dec 13, 2024
Friday Dec 13, 2024
Monday, 16 November 2020 00:00 - - {{hitsCtrl.values.hits}}
During the pandemic that has adversely affected the Sri Lankan economy, Merchant Bank of Sri Lanka and Finance PLC (MBSL), a subsidiary of the Bank of Ceylon, was at the forefront of providing relief to its clientele and the citizens of Sri Lanka. It is the country’s pioneer merchant bank and has dedicated itself to serving the Sri Lankan public since its inception in 1982 as a financial institution.
In this commitment, the MBSL has provided relief to more than 20,000 of its customers during these trying times. In the recently released third quarter results depicting a loss of Rs. 731 million, the moratorium effect accounts for Rs. 650 million. It was the mandate and wish of the company to extend its fullest support to the business sector and customers to revive their businesses through relief via the moratorium.
Apart from the moratorium effect, the company’s earnings were negatively affected due to the drop in interest income and fee-based income stemming from low credit growth in the second and third quarters. This is mainly due to subdued economic activity during the pandemic period and an increase in credit impairment charges.
These negative effects come at a crucial time, when the Central Bank of Sri Lanka has requested for capital adequacy levels to be maintained. MBSL is aware of and evaluating the best options available, given the current local and global macro-economic scenario. As a subsidiary of the country’s premier bank, Bank of Ceylon, which owns a 74.49% stake in the MBSL, the company is poised to meet the capital adequacy requirement (CAR) by end of the first quarter 2021.
While taking action to meet the CAR, the company has managed its overheads well and has been able to reduce the cost by Rs. 50 million compared to the previous year through stringent cost control. With a strong management team and a long history of working with all sectors of the country fulfilling the financial requirements of the public, MBSL remains well-positioned and will continue to serve the country in the future.
It banks on the support and loyalty of its stakeholders and clients, and looks forward to a resilient 2021 where more creative and innovative products and services will be introduced to the market that will strengthen both the company and its relationships with all sectors. Through this, MBSL hopes to negate the adverse effects of the pandemic and to contribute to the revival of Sri Lankan businesses and economic activity.
