Regulatory action on TFC extended for three months: CB

• CB says extension needed to consider business restructuring proposal presented by The Finance Company

The Central Bank yesterday extended for three months regulatory actions it had taken regarding The Finance Company (TFC) in order to consider a business restructuring proposal submitted by the company.  

The Monetary Board of the Central Bank of Sri Lanka (CBSL) initiated a number of regulatory actions, as temporary measures, on The Finance Company PLC (TFC) with effect from 15 February, with a view to safeguard the interests of the depositors and other stakeholders of the company. 

Regulatory measures included suspension of accepting new deposits, withdrawal of deposits and disbursement of loans and advances to facilitate the restructuring process of TFC.

“The Monetary Board of the Central Bank has decided to extend the said regulatory actions for another three months period from 15 May 2019, in order to consider the business restructuring proposal submitted by the company. Interest due on deposits will be paid continuously,” a statement released by the Central Bank said. 

In February the Central Bank suspended TFC accepting new deposits, restricted withdrawal of deposits and restricted disbursement of loans and advances to facilitate the restructuring process of TFC. At the same time, all borrowers of the company were strictly advised to pay their dues.The Central Bank also announced the appointment of an expert’s panel in banking and finance to facilitate the restructuring process of TFC as previous efforts in identifying prospective investors and restructuring of the company have failed. 

Although, several attempts were made to identify prospective investors and to restructure the company, such efforts have not materialised yet, the Central Bank said at the time. Thus the continuity of the current status will be further detrimental to the interest of depositors and other stakeholders of the company, it said explaining its regulatory restrictions. 

The depositors may contact the Department of Supervision on Non-Bank Financial Institutions of the Central Bank of Sri Lanka through 0112 477 573, 0112 477 229, 0112 477 504 or [email protected] for further clarifications.