Tragedy of depositors of finance companies
Allow me to add a ‘footnote’ to the Letter to the Editor, by “Depositor in a Finance Company”, appearing in the Business Times of July 5.
The Central Bank (CB-which was a highly respected institution during its founding in the 1950s and through to the 1960s, during which time only experienced economists held policy- making positions) has utterly lost the confidence of the public during the past decade.
The reasons for this are many including appointment of unsuitable persons to key positions. Dr. Indrajit Coomaraswamy was one of the few well qualified professional economists to hold the post of Governor in recent times, but he has now retired.
The brazen ‘con’ – that “a difficulty in finding experienced professionals”, is the reason why the CB will allow decrepit old individuals to head listed companies and Government entities, is ‘shameful”, as is pointed out in that above mentioned letter. Directors of many public companies are in their late ‘70s, some others, in their ‘80s, touching ninety!
If one looks at some of the annual reports of very established listed companies in Sri Lanka, it is not at all unusual to find persons in their late 70s, and even some in their late ‘80s brazenly “offering themselves for re-election” as directors.
A connected issue- the history of finance companies in Ceylon- and continuing into ‘Sri Lanka’, is indeed a pathetic one, starting from the very first major failure, that of HPT Finance (in the 1960s) in which its top management , are said to have found a haven in Australia. Then, just as now, (who still remembers the forgotten issue of CB Governor Arjuna Mahendran?), the Central Bank utterly failed. It failed in its duty to monitor the finance companies in the first place, and followed up by failing to provide any proper solace to the depositors either.
I remember the days when HPT Finance Co collapsed, destroying thousands of minor deposit holders. I personally saw a very elderly lady in a white saree reading the notice put up outside its premises by HPT – basically, politely telling the depositors – “Hard Luck”! Obviously her life savings or a good part thereof, had evaporated, – with bewilderment on her face which was a pathetic sight.
But the hallmark of some of these finance company ‘operators” and their ilk, is that they are completely free of either any sense of remorse, or any shame.
Jayanta Kurukulasuriya