By Ravi Ladduwahetty
Ceylon Finance Today: The banking and financial sector consolidation which was brought about by the previous government has been deferred till the next Parliamentary elections.
The attention of the government has been dawn to the fact, that the evaluation of the banking and financial sector consolidation process needed time and that was very unlikely to take place within the 100 day programme of the new government, top sources told Ceylon FT.
They also said that the financial sector consolidation needed a longer term plan and that even the NDB Bank-DFCC Bank merger was also ending up as a stalemate.
They also said that special emphasis would also be laid for the troubled banks and finance companies, and Central Bank Governor Arjuna Mahendran had expressed his willingness to meet the depositors of the CIFL.
Earlier, the Ceylon FT reported in its Sunday edition of 25 January that bigwigs in the banking and the finance companies sector were scheduled to meet Deputy Minister of Policy Planning and Economic Affairs Dr. Harsha de Silva and Central Bank Governor Arjuna Mahendran, claiming that they were made to agree to the previous government's banking sector consolidation process under heavy duress.
The need for the bigwigs in the banking sector to meet Dr. de Silva and Cabraal and Mahendran comes in the wake of a reception hosted by the Central Bank and former Governor Ajit Nivard Cabraal, to 'celebrate' the success of the banking consolidation process of the former government.
CEOs allege that the consolidation process was hurriedly implemented even without informing the Colombo Stock Exchange, which also saw the rapid upward movement of the shares of the listed banks and the finance companies.
A finance company CEO, speaking on the basis of anonymity, said that they were summoned to periodic meetings after the Central Bank Road Map 2014, and that they were forced to agree with the mergers. "We did not want to disagree, being fully aware of the consequences of defying the government," he said.
They said that there were only two consolidations which were done by Commercial Bank, which bought Indra Finance and Hatton National Bank which brought 51% of Prime Grameen Bank. The previous government even cancelled the leasing licence of Koshiba Finance of Nittambuwa merely because they did not agree with the consolidation process, he said.
He also said that, the DFCC Bank-NDB Bank merger, which was the biggest in the sector, was still not finalized.
www.ceylontoday.lk
Ceylon Finance Today: The banking and financial sector consolidation which was brought about by the previous government has been deferred till the next Parliamentary elections.
The attention of the government has been dawn to the fact, that the evaluation of the banking and financial sector consolidation process needed time and that was very unlikely to take place within the 100 day programme of the new government, top sources told Ceylon FT.
They also said that the financial sector consolidation needed a longer term plan and that even the NDB Bank-DFCC Bank merger was also ending up as a stalemate.
They also said that special emphasis would also be laid for the troubled banks and finance companies, and Central Bank Governor Arjuna Mahendran had expressed his willingness to meet the depositors of the CIFL.
Earlier, the Ceylon FT reported in its Sunday edition of 25 January that bigwigs in the banking and the finance companies sector were scheduled to meet Deputy Minister of Policy Planning and Economic Affairs Dr. Harsha de Silva and Central Bank Governor Arjuna Mahendran, claiming that they were made to agree to the previous government's banking sector consolidation process under heavy duress.
The need for the bigwigs in the banking sector to meet Dr. de Silva and Cabraal and Mahendran comes in the wake of a reception hosted by the Central Bank and former Governor Ajit Nivard Cabraal, to 'celebrate' the success of the banking consolidation process of the former government.
CEOs allege that the consolidation process was hurriedly implemented even without informing the Colombo Stock Exchange, which also saw the rapid upward movement of the shares of the listed banks and the finance companies.
A finance company CEO, speaking on the basis of anonymity, said that they were summoned to periodic meetings after the Central Bank Road Map 2014, and that they were forced to agree with the mergers. "We did not want to disagree, being fully aware of the consequences of defying the government," he said.
They said that there were only two consolidations which were done by Commercial Bank, which bought Indra Finance and Hatton National Bank which brought 51% of Prime Grameen Bank. The previous government even cancelled the leasing licence of Koshiba Finance of Nittambuwa merely because they did not agree with the consolidation process, he said.
He also said that, the DFCC Bank-NDB Bank merger, which was the biggest in the sector, was still not finalized.
www.ceylontoday.lk
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