Reducing number of fincos. welcome, BT poll shows
View(s):Last week’s budget proposal for companies and banks to absorb subsidiaries operating as finance company has won near unanimous approval in a Business Times poll this week.
Asked whether the government’s proposal asking companies to take under their wing finance companies subsidiaries, 90 per cent of the respondents said it was a good proposal. More than 80 per cent said the proposal will help reduce risks to depositors who opt to invest in finance companies. One respondent agreed that the proposal was a good one but was not convinced that the risk would be minimized. “If a finance company is engaged in fraudulent activities, it applies to the parent company as well. A good example is all those subsidiaries of Ceylinco Group, which accepted deposits from investors and collapsed together with the holding company. The proposal will bring in ‘mixed results’ and is not a foolproof solution to the problem,” he said.
