Central Bank gives conditional finance company nod for Nation Lanka

Thursday, 27 October 2011 03:41 - - {{hitsCtrl.values.hits}}

The Monetary Board has granted conditional approval for Nation Lanka Finance Plc to register as a finance company.

The conditions include meeting the core capital requirement of Rs. 400 million as per the Finance Companies (Minimum Core Capital) Direction No. 01 of 2011; amending to the Articles of Association of CSF incorporating required provisions to operate as a registered finance company; settlement of matured promissory notes worth of Rs. 5 million; submission of a business plan identifying how the company would overcome the current loss situation; and compliance with current directions issued to specialised leasing companies under the Finance Leasing Act No. 58 of 2000. National Finance is also required to divest loss-making subsidiaries, investments and real estate with no returns received within the next two years.

Nation Lanka, formerly Ceylinco Securities and Financial Services Ltd., has a stated capital of Rs. 1.3 billion, as at 30 June 2011 up from Rs. 518 million a year earlier. This was following the infusion of Rs. 800 million via a Rs. 500 million private placement and Rs. 300 million from a Rights Issue, both at Rs. 5 per share. However, its reserves were a negative Rs. 902 million.

The company’s ownership changed early this year with Asanga Seneviratne – famed investor of Access Equities – owning 35% and Nawaloka Construction and J. Rudra owning 7% each.

In May this year top professional banker and former General Manager and CEO of Seylan Bank Ajita Pasqual joined as a consultant.