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Wednesday, 21 October 2020 00:27 - - {{hitsCtrl.values.hits}}
Softlogic Finance PLC yesterday said it is upbeat on future prospect, despite the Central Bank (CB) notice on select finance companies which are non-compliant with the minimum capital adequacy
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| Softlogic Finance CEO Priyantha Wijesekera
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requirement and given a time extension to rectify the issue.
Softlogic Finance PLC in a filing to the Colombo Stock Exchange said it has received CSE approval for its rights issue of Rs 1.9 billion and the EGM of the Company is fixed for 9 November, with the funds expected to be received by the Company towards the end of November.
The issue is fully underwritten by its immediate parent Softlogic Capital PLC and the entire equity infusion is hence guaranteed.
The Softlogic Group has also announced purchasing the shares of Abans Finance PLC consequent to which Abans Finance PLC will be amalgamated with Softlogic Finance PLC with the latter being the surviving entity. The transaction is currently pending approval of the CB.
The combined entity, post-merger will create a stronger and bigger company that is estimated to have total assets of Rs. 32 billion, customer deposits of Rs. 22 billion and customer advances of Rs. 26 billion, whilst complying with all of the regulatory requirements of the CB including the capital adequacy of the company. The capital position of the amalgamated entity is expected to be Rs. 4.9 billion by 31 March 2021.
“Softlogic Finance is hence upbeat on its future prospects, which will deliver a robust business strategy enhanced by digitalisation and delivered by the new management team of the company that is in place since May of this year,” the company said in its disclosure to the CSE.
It said unparalleled customer convenience and ease of doing business are expected to bring about synergies within the Softlogic Group’s huge customer base and will follow the enormous success delivered by its sister company Softlogic Life Insurance PLC, which is the country’s fastest growing life insurer, having recorded a five-year growth of 30% versus industry growth of 12%.
The disclosure also said the Softlogic Group has long viewed Financial Services as an industry with substantial opportunities for growth. This proposed merger compliments Softlogic Finance in its ambition to increase its footprint in the NBFI sector, particularly in the dynamic leasing category, which represents an area of strategic focus for the company.
“The Company is currently re-evaluating its product mix and service offering and work is in progress to streamline its systems and processes to suit a digitized environment, in order to prepare the company to confidently face the constantly changing external landscape and sustainably deliver a distinctive and easily accessible value proposition to its customers,” the disclosure added.
It said the Softlogic Group is regarded as one of Sri Lanka’s most dynamic and progressive conglomerates, with industry leadership in key business verticals; with its presence visible across the Healthcare, Retail, Financial Services, ICT, Automobiles and Leisure sectors.
