Central Bank cancels Swarnamahal Financial Services licence

The Central Bank of Sri Lanka on Wednesday decided to cancel the Finance Business Licence issued to Swarnamahal Financial Services PLC (SFSP) with immediate effect.

The licence had been earlier suspended over irregularities.

The banking regulator said that in view of the contribution made by SMB Finance PLC (SMBF) (then SMB Leasing PLC) to repay the remaining deposits of SFSP, as per the directions of the “Masterplan for Consolidation of NonBank Financial Institutions Sector”, unclaimed deposit liability of SFSP will be transferred to SMBF along with the corresponding assets value and relevant depositor information.

Further, Sri Lanka Deposit Insurance and Liquidity Support Scheme (SLDILSS) will take necessary actions to pay compensation to the outstanding insured depositors of SFSP up to a maximum of Rs. 1,100,000 per depositor as per the regulations of the SLDILSS in due course. Upon the transfer of unclaimed deposit to SMBF and payment of compensation through SLDILSS, the entirety of the deposit liability of SFSP will be settled, the Central Bank said.