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Wednesday, 30 April 2014 00:05 - - {{hitsCtrl.values.hits}}
Nine audit firms selected by the CB to carry out valuations on the banks and Non-Banking Financial Institutions (NBFI) will finalise and submit their reports on 2 May 2014.
Interested buyers will then have access to the documents on request to the CB who will be the custodians of the report.
The valuation document is said to be the basis for negotiations for the buyer, Central Bank Assistant Governor C.J.P. Siriwardana told MTI Consulting forum on financial sector consolidation yesterday.
Stating that the first round of the consolidation process is a voluntary one, Siriwardana cautioned that in the second round if companies fail to find a suitable partner, the CB would intervene.
“There will be an intervention by the CB if companies fail to find partners. This will take place at the final quarter of the year, but till then we will not get involved,” asserted Siriwardana.
The banking sector comprises of 21 local banks and 12 foreign banks, whereas NBFIs include 49 finance companies and nine leasing companies. Banks and NBFIs account for 64% of the entire financial system assets where banks hold 57% and NBFIs 7%.
He said that with 31 March 2014 as the deadline for all banks and NBFIs to submit their proposals regarding prospective mergers and acquisitions, all institutions have complied.
Siriwardana said institutions responding on time with their submissions indicate the willingness of the industry to go ahead with the move that was announced by the regulator earlier this year.
“I am happy to say that all the banks and the finance companies have submitted their proposals and this indicates their willingness to actively take part in the consolidation step.
With everything going as planned so far, I am sure we can finalise the first round of matchmaking soon,” Siriwardena said at the event which featured CB Governor Nivard Cabraal as the Chief Guest.
The MTI forum created a platform to discuss financial services sector consolidation and how to ensure effective integration and synergies.
The main presentation and the moderation for the panel discussions was done by MTI Consulting CEO Hilmy Cader.
The eminent panel of experts providing their knowledge and experience to the discussion comprised of Union Bank of Colombo Director/CEO Anil Amarasuriya, Sampath Bank MD Aravinda Perera, DFCC Bank CEO Arjun Fernando, Central Bank of Sri Lanka Assistant Governor C.J.P. Siriwardana, Hatton National Bank MD/CEO Jonathan Alles, Colombo Stock Exchange Chairman Krishan Balendra, The Finance Company Chairman Preethi Jayawardena and National Development Bank CEO Rajendra Theagarajah.
The Daily FT will feature the full discussion at the forum in the coming days.
