DFCC-HNB venture ready by June

The proposed Rs. 500 million joint venture investment bank by the DFCC Bank and HNB will be set up by June, provided the necessary regulatory approvals are obtained with a medium term plan to go for an initial public offering (IPO). “Our target is to set it up by June,” Nihal Fonseka, General Manager/Chief Executive Officer of DFCC Bank and Chairman-designate of the new investment bank told The Sunday Times FT.

He said the two entities have always explored ways of forging ahead with their investment banking and decided on this avenue. This equally owned investment vehicle will carry out the amalgamated corporate finance and capital markets businesses of the two institutions and will also be the group holding company for the other related entities of the two banks including the stock broking and primary dealership functions.

“The objective is to pool the strengths and resources of DFCC Bank and HNB to attain a critical mass and enable synergies while providing the full service range of a typically integrated investment banking operation,” he said. HNB officials have said that an IPO for the new entity is on the cards in the medium term. “Anything is possible and that is certainly something we will explore,” Fonseka said, when asked about an IPO.