Melsta Regal Finance celebrates two years of success
Thursday, 16 October 2014 00:32
Melsta Regal Finance Ltd. will celebrate its second anniversary on 18 October. Two years ago the company, which is backed by the DCSL group, forayed into the financial services sector with the objective of creating and adding value to the financial landscape of the country.
Melsta Regal Finance Ltd. can be credited as the only finance company in the sector which has diversified and differentiated its product range. Traditionally, most finance companies focus predominantly on leasing and hire purchase products. During its short history, the company has infused much vibrancy and colour into the financial services industry.
Through its extensive product range, encompassing integrated working capital solutions, term loans for business expansion, project loans for new business startups and specialised factoring and cheque discounting services, the company has carved a niche in the market. Thereby the company aims to satisfy the financial needs of a larger segment of the business community, be it a SME or a large corporate entity.
The company at its formation stages largely focused on the right mix to serve these discerning segments of the business community. The company being a part of the multi-faceted Melstacorp Group has access to the professionalism of many group companies such as Aitken Spence’ s expertise in logistics and the Melsta Logistics Formula World Collision Repair Centre. Most of the company’s services are value added and enriched with the expertise of the group’s professionalism in clearing, cargo handling with logistics and state-of-the-art vehicle repair center.
The company’s service ethos lies in the flexibility of a finance company along with the expertise of a bank. The company’s Chairman Amitha Gooneratne stated:”The overall strategic intent of the DCSL Group in entering the financial services sector is to infuse confidence and stability. Melsta Regal in this journey would offer and position itself on par with a bank in terms of product breadth and flexibility. With the Central Bank’s consolidation plans the financial services industry is now at a crucial juncture. We see this as a favourable time for the company to take off to the second stage of growth with the opportunities available to us.”
Melsta Regal Finance Ltd. was one of the first companies to adhere to the Central Bank of Sri Lanka’s capital adequacy requirements by infusing Rs. 650 million equity in March 2014. Presently, the company, with its stated capital of Rs. 1.3 billion, is in compliance with capital adequacy requirements till 2016.
A significant milestone of the company was the A+rating by Fitch Ratings Lanka in the very first year of operations and this has been re-affirmed in 2014. The company is one of the few finance companies that have achieved this rating.
It recorded an impressive growth trajectory of achieving a 204% year-on-year credit growth in an external environment of sluggish credit growth. The balance sheet size of the company is over Rs. 3.5 billion.
Speaking on this achievement, Director/CEO Nishaman Karunapala said: “The company, in its focus of significant growth levels, adopted a prudent approach of being conscious of credit quality aspects as well. We have the lowest NPA ratios of the industry. This was achieved with a two-pronged approach of maximizing productivity whilst focusing on qualitative aspects of credit.”
The company’s stability and strength was exemplified when it secured a $ 10 million foreign currency funding line recently. Access to such low cost funding lines would undoubtedly benefit the SME clientele of the company, which is the focus of the company, particularly with its branch expansion plans.
In moving forward, the company hopes to expand its regional presence to key cities. Further, within the next few months, the company hopes to launch new innovative credit instruments along with savings products incorporating state-of-the-art IT systems.