Financial Times

Savings bank may replace Pramuka Bank
The government is considering turning the failed Pramuka Bank into a savings bank with the option of using Treasury funds as capital, informed sources said.
“We can’t allow it to collapse for no fault of the depositors,” one source said adding that the Central Bank should be rational in its approach and revive the bank and protect the depositors.

The government under President Mahinda Rajapakse has promised to revive the bank and various options on how to resurrect it are being considered. Asked whether the Central Bank would raise the capital required, the source said a suggestion that the Treasury pump in millions of rupees to restructure bank is under consideration.

Depositors of the failed bank have been keeping their hopes high after a positive government response on the fate of their deposits. Palitha Gamage, President of the Depositors Association told The Sunday Times FT that Wijayadasa Rajapakse, Minister of State Bank Development, has assured them that the matter would be resolved by January 31 (Tuesday). Meanwhile the judgement of the Appeal Court on the case against the Central Bank by the depositors not to liquidate the PSDB (Pramuka), which was scheduled to be delivered on January 23 has now been postponed to March 1. Gamage said that they are confident that the government would act on its decision and find a solution to the prolonged agony of the 15,200 depositors of the PSDB. Once the government decides on the course of action on PSDB it would be communicated to the courts.

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