Sri Lankan stocks close steady; foreign buying boosts turnover

Reuters: Sri Lankan shares ended steady on Friday, with falls in hotels and travel companies offsetting gains in diversified holdings and health care stocks, while foreign buying helped boost turnover.

The benchmark Colombo stock index ended 0.02 percent weaker at 6,539.09 and posted its second straight weekly loss, of 0.2 percent.

Foreign investors, who have been net sellers of shares to the tune of 2.98 billion rupees ($20.48 million) so far this year, bought a net 612.9 million rupees worth of shares.

Turnover stood at 1.47 billion rupees ($4.05 million), the highest since Aug. 23 and well above this year's daily average of 758.8 million rupees.

"The market held on with little bit of profit-taking. But there was very little selling, block deals boosted turnover," said Dimantha Mathew, head of research at First Capital Equities (Pvt) Ltd.

Shares of Kandy Hotels Company (1938) Plc rose as much as 11.5 percent to their highest since September 2015 before closing 7.69 percent higher, and accounted for 39.66 percent of the total turnover.

Ceylon Cold Stores Plc fell 3.38 percent, while Trans Asia Hotel Plc dropped 6.89 percent. 

($1 = 145.5000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)

Sri Lanka to wrap up US$700mn syndicated loan in days

ECONOMYNEXT - Sri Lanka is expected to wrap up a $700 million syndicated loan in days, ending the country's external borrowings for the year, officials said.

Sri Lanka was originally expected to raise $500 million from the three-year syndicated loan, where lead arrangers Citi, CS Singapore, Emirates NBD, HSBC and Mashreq gave an early $300 million.

Sri Lanka is not expected to go for foreign more foreign borrowings in 2016, Central Bank Governor Indrajit Coomaraswamy said.

Sri Lanka also sold a $1.5 billion sovereign bond.

Proceeds of the bond were also used to repay a maturing Sri Lanka Development Board tranche earlier this month.

Sri Lanka freezes assets of Entrust Securities shareholders: CB Governor

ECONOMYNEXT - Authorities have frozen assets of shareholders of Entrust Securities, a primary dealer in gilts, that is alleged to have bilked billions of rupees of clients including the Central Bank itself amid a criminal probe, an official said.

Affairs of Entrust Securities are now administered by state-run National Savings Bank.

Central Bank Governor Indrajit Coomaraswamy told reporters in Colombo that there were discussion on bringing another bank to help overlook its operations.

Meanwhile, some assets of shareholders had been frozen, he said. A criminal investigation was also ongoing.

Entrust Securities is alleged to have sold government securities to clients twice and pulled the money out, and borrowed funds at higher rates than underlying securities to pay those who demanded funds back.

Among the top victims is the provident fund of state-run Ceylon Electricity Board (CEB), and the Central Bank's own pension and rural development department funds.

According to its annual report Rs1.4 billion of rural development funds were found to be "uncollateralised".

The Central Bank worker's Widows' and Orphans fund was hit for Rs283 million. Its Gratuity and Medical Benefits scheme was hit by Rs129 million.

The Central Bank has multiple pension and retirement funds for the benefit of workers, family members and retirees, which are mostly protected from inflation the agency itself generates.

ADB to invest $50m in Sri Lanka’s Hatton National Bank

ECONOMYNEXT – The Asian Development Bank (ADB) is to invest $50 million in Sri Lanka’s Hatton National Bank (HNB) in a private placement, taking a stake of up to 9.9 percent of the bank’s ordinary voting shares.

HNB said in a stock exchange filing that it sees the ADB as a “strategic investor”, and that the money will be used to strengthen the bank’s balance sheet and support overall business growth.

The private placement is subject to approval at an Extraordinary General Meeting, as well as stock exchange and other governmental or regulatory approvals.

The ADB would be sold the stake at the average price at which HNB shares were traded in the 30 market days preceding the EGM, or at Rs220 if the average price is over Rs220 or Rs190 if the average price is less than Rs190.

Ceylinco Life’s 6-month income up 14% to Rs 11 bn

Life insurance leader reports strong growth in premium and investments Ceylinco Life’s total income has increased by 14 percent to Rs 11.03 billion in the six months ending June 30, 2016, with robust growth in both gross written premium and income from investments enabling the life insurance leader to consolidate its position at the helm of the sector.

Gross premium income at the end of the first half of the year totalled Rs 7.17 billion, reflecting a growth of 12 percent over the corresponding six months of 2015, the company said.

Investment income improved by a healthy 18.2 percent to Rs 3.855 billion in the six months reviewed, taking Ceylinco Life’s investment portfolio to Rs 72.792 billion, representing an increase of Rs 11.568 billion over the preceding 12 months.

The company’s Life Fund stood at Rs 72.183 billion as at June, 30 2016, a growth of nearly Rs 7 billion since the end of the second quarter of last year.

“Conditions for selling life insurance remain tough, but our strong focus on fundamentals and the solid platform of market leadership we have built over the past 12 years enables the company to maintain its momentum,” Ceylinco Life Managing Director/CEO, R. Renganathan said.

“Our market leadership represents the trust and confidence the company has built, principally through its financial strength, fulfillment of promises and its unwavering commitment to policyholders.”

Ceylinco Life paid Rs 3.28 billion in net benefits and claims to policyholders in the six months reviewed, an increase of 18 percent over the corresponding period of last year.

Total assets of the company grew by 7.7 percent over the six months to Rs 86.4 billion.

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Softlogic Capital records Rs. 1.1 bn profit

Softlogic Capital PLC, the financial services holding company of the Softlogic Group, crossed the Billion Rupee profit mark and reported Profit after Tax (PAT) for the Sector of Rs. 1.1 Billion for the financial year ended March 2016. The result was a substantial increase of 45% compared with the previous year's PAT of Rs. 782 Million. Turnover for the Sector after consolidation was Rs. 11.1 Billion, an increase of 12% compared with the previous year. Total Assets of the Sector were Rs. 34.7 Billion.

The Financial Services Sector contributed 16.7% to the top line of the Softlogic Group with revenues of Rs. 11.1 Billion and more importantly contributed Rs. 1.1 Billion to the bottom line of the Group, making it one of the major investment successes that the Group has achieved.

The Softlogic Group that entered the financial services arena in the latter part of 2010, within a short period of just four years, has quickly moved to streamline and significantly enhance its acquisitions in Insurance, Finance & Leasing and Stockbroking.

Asian Alliance Insurance recorded a Profit of Rs 924.3 Million with Life Insurance recording a top line of Rs 4.1 Billion for the year growing 34%, whilst General Insurance recorded a top line of Rs. 1.9 Billion, growing by 15%.

Softlogic Finance recorded PAT of Rs. 375 Million, increasing by 73% whilst Total Assets of the company were recorded at Rs. 20.9 Billion.

Softlogic Stockbrokers generated revenues of Rs. 263 Million that was an increase of 59% compared with the previous year, and was ranked second in the market.

Asian Alliance won a slew of top notch awards that included Asia's “Innovation of the Year” for its Click2Claim Motor product, a National Business Excellence Gold Award and was selected as one of the Top 25 Great Places to Work in Sri Lanka for 2016.

The Softlogic Group that entered the financial services arena in the latter part of 2010, within a short period of just four years, has quickly moved to streamline and significantly enhance its acquisitions in Insurance, Finance & Leasing and Stockbroking.
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