PM holds Central Bank responsible for the collapse of financial institutions under its purview

(COLOMBO, LANKAPUVATH) – Prime Minister Mahinda Rajapaksa has said that the Central Bank should take responsibility for the collapse of the financial institutions under its purview and urged to take action against fraud at these institutions.

The Prime Minister made these remarks at a discussion held today at the Temple Trees on the current status of the Finance Company PLC.

“The continuous collapse of financial institutions under the Central Bank of Sri Lanka and the malpractices at such financial institutions bring disrepute to the government,” the Prime Minister has stressed.

He added that new laws should be enacted or actions should be taken to deal with such financial fraud.

The Prime Minister requested that the money be paid to the depositors of The Finance Company PLC expeditiously.

The Deputy Governor of the Central Bank HA Karunaratne informed that up to 97% of depositors will be paid from Monday and the balance 3% will be paid later.

Prime Minister Rajapaksa’s intervention comes weeks after the Central Bank cancelled the finance business license issued to of The Finance Company after all efforts made to revive the company through different strategies have failed.

The Central Bank has decided that continuing the company in its current state will be detrimental to the interest of the depositors and other stake holders of the company.

Joining the discussion, Minister Ramesh Pathirana said a formal inquiry should be conducted into the defrauding of people’s money by a financial institution under the supervision of the Central Bank.

Minister Ramesh Pathirana further stated that the Finance Company PLC has continued to issue statements to gain people’s trust even when there were troubles in the company.

Minister Bandula Gunawardena pointed out that justice should be given to the depositors of The Finance Company PLC as well as to the depositors of other financial institutions which have already collapsed.

The Deputy Governor of the Central Bank said although The Finance Company PLC was under the supervision of the Central Bank, it was governed by an independent board of directors and added that the company could be transferred to an investor.

Prime Minister’s Secretary Gamini Senarath, Central Bank Governor Prof. WD Lakshman, Secretary to the Finance, Economic and Policy Development Ministry SR Attygalle and legal advisers were among those present at the discussion.

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