Entrust infuses capital of Rs. 2.5 b to resurrect The Standard Credit Finance
Thursday, 11 September 2014 00:51
A licensed finance company that was caught up in the financial debacle of the Ceylinco Group has been successfully resuscitated and a new lease of life been given to the aggrieved depositors of The Standard Credit Finance Ltd. (TSCFL) by the management of Entrust Group.
The Standard Credit Finance Ltd. was formerly titled Ceylinco Investments & Realty Ltd. (CIRL) and was one of the distressed regulated finance companies under the management of the Ceylinco Group. Its principle lines of business activities included finance leasing, hire purchase, security loans, personal loans and land easy payments and acceptance of fixed deposits from the public.
During the crisis period as decided by the Central Bank of Sri Lanka (CBSL) the companyâ€™s management was initially handed over to Lankaputhra Development Bank, which was appointed as the Managing Agent by the Monetary Board of the Central Bank of Sri Lanka on 28 March 2009 to manage the affairs of the company. Subsequently Merchant Bank of Sri Lanka took over as the Managing Agent in September 2009 and during year 2010, the company underwent another name change as it was re-named The Standard Credit Lanka Ltd.
Entrust Group, which is also an aggrieved creditor, had initially advanced an amount of Rs. 384 million to TSCFL prior to the crisis period and in the process of recovering its dues, the Monetary Board of the Central Bank of Sri Lanka upon accepting the submitted restructuring plan invited Entrust Ltd. to sign a Memorandum of Understanding with TSCFL. Since 1 April 2011 this collaboration has enabled the two companies to formulate and implement the proposed plan in order to safeguard the interest of the distressed depositors.
A spokesperson for the group said that based on the ongoing financial sector consolidation program and to comply with the directions issued by the Monetary Board, Entrust Group was required to infuse additional capital amounting to Rs. 2.5 b to TSCFL and this process was successfully concluded. The 3,500 odd clientele of The Standard Credit Finance Ltd. can be content that, with this additional infusion of capital, the company will have a positive NAV of Rs. 2.2 b.
With Entrust Groupâ€™s proposed structured financing plans, TSCFLâ€™s total assets will reach Rs. 7 b. TSCFL, which was initially titled Panadura Finance & Enterprises Ltd., has a history of almost 45 years and Entrust Group is proud to place on record its accomplishment in the resurrection of this deep-rooted finance company.
The successful implementation of the business revival plan of TSCFL is being carried out under the guidance and support of Central Bank Governor Ajith Nivard Cabraal and other CBSL officials. Entrust Group will focus on implementing the rest of the directions issued by the Monetary Board as per the proposed consolidation plan in protecting the interest of all stake holders of the company and also to position Entrust as a trusted brand in the financial sector.