People’s Leasing devises a revival plan for CIFL
The People’s Leasing & Finance PLC as the Managing Agent of Central Investments and Finance PLC (CIFL) has prepared a revival plan to rescue the ailing finance company with the approval of the Central Bank (CB) Monetary Board, Sanjeewa Bandaranayake, Deputy General Manager of PLC told the Business Times.
It has been suggested to the CB to find an investor to continue operations of the ailing finance company, he revealed.
The company has a deposit base of over 6000 who have invested a total of Rs. 3.4 billion. In a stock exchange filing, Lakshman Rupasinghe non-executive director of the company stated that the company is not in a position to make payments for depositors due to the restructuring process undertaken by PLC on the supervision of the CB’s Department of Supervision of Non-Bank Financial Institutions.
Earlier the CB appointed PLC as the new managing agent of the crisis-hit CIFL, after its new investors, the Maloney-led Touchwood Group failed to make a promised capital infusion of US$12 million on or before the stipulated date, a senior CB official said.
CIFL has been hit by a liquidity crisis where payments were delayed to depositors, and the CB after discussions agreed to the infusion of foreign cash by the owners of Touchwood (Maloney couple) and subsequent take over.
Touchwood also took over management of the company making major changes to the board of directors including a new chairman. The changes took effect from 2nd May.
Three new board members, Roscoe Malony, Swarna J. Maloney and Dulan Hettiarachchi were appointed to the board of the company. K.A.L. Rupasinghe resigned from his position as Chairman and was replaced by Mr. Malony.
H.M. Ekanayake, CB Director – Department of Supervision of Non-Bank Financial Institutions, told the Business Times that the present board of directors will remain as it is and they should take the responsibility of reviving the company.
In response to a question raised in parliament by parliamentarian Anura Kumara Dissanayake, Minister Dinesh Gunawardena said the Director Board had made irresponsible and reckless investments using people’s deposits.
“After the auditing is done, its findings will be submitted to the Central Bank. Based on the comprehensive on-site examination, information was provided to the Criminal Investigations Department (CID) to take action against the culprits,” he said.
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