HNB unregistered scrip shares likely to be sold
The Hatton National Bank PLC (HNB) is gearing to sell some 900, 000 voting shares accrued on account of scrip dividend payments made by the bank in 2012, 2015 and 2016 to certain parties whose names were struck off the HNB shareholders’ register in 2010 to comply with the law, industry sources say.
The shares are now held in a suspense account at the Central Depository System (CDS), HNB said last week in a stock exchange filing adding this was because there is no specific beneficial owner to whom these shares could be allotted.
The 11.3 million unregistered HNB voting shares had been disposed by the holders, which are three Harry Jayawardena-controlled companies in January and February this year, HNB said in a Stock Exchange filing without disclosing who the holders of these unregistered shares were.
The sources told the Business Times that HNB is getting legal advice on the best possible way to sell scrip shares.
Three Harry Jayawardena-related companies, Milford Exports (Ceylon) Ltd (7.94 per cent), Stassen Exports Ltd (6.88 per cent) and Distilleries Company of Sri Lanka (3.08 per cent), together held a total of 17.9 per cent of HNB in excess of limits prescribed by a Central Bank (CB) direction under the Banking Act which is 10 per cent and a maximum of 15 per cent with CB’s Monetary Board sanction.
Sources said that for the past six years since 2012 the CB has written to HNB to dispose these shares but they hadn’t audaciously heeded it. Finally they disposed 11.343 million (2.89 per cent) of the 18.35 million unregistered shares (4.6 per cent) of HNB during the past two months.
On Tuesday another 5.6 million shares of the 7 million (1.78 per cent) remaining shares were sold in 5-crossings. All shares were bought by foreigners.