Banking sector consolidation committee to meet this week
View(s):A government-appointed committee to review a current programme to integrate finance companies and banks will meet in two days time for their first official meeting.
Its Chairman Dinesh Weerakkody told the Business Times that they will issue the promised report within the next month. “We will adhere to the 100-day programme timeline.”
While he refrained from commenting on the DFCC and NDB merging with each other, he said that their report will grant an insight to the whole financial sector consolidation.
Other members in this committee reviewing the previous regime’s banking sector consolidation process are former Central Banker, W.A. Wijewardena, former DFCC CEO Nihal Fonseka, a Treasury official and Central Bank official.
A DFCC official stressed that it’s important to consolidate, but they too want an indication from the regulator. “We realise that there’re cost reductions and synergies that are created, but we also want the response of the majority stakeholders, which are the state entities,” he said.
The NDB official added that there’s no point going before the shareholders without this opinion as the state entities will also vote and if they aren’t in favour, then it’s highly unlikely this proposal will go through. Many anticipate that the state entities which collectively own over 30 per cent in each bank will not vote for the merger.
Both officials said that they will discuss with the Central Bank and the Treasury on this matter. (DEC)