‘Our aim is to create value and new opportunities’: DFCC Chief Royle Jansz

DFCC Chairman Royle Jansz

Q: Why did DFCC Bank and DFCC Vardhana Bank decide to merge?

A: Well, in short, the merger creates a stronger organisation. This amalgamation will create value and new opportunities while enhancing growth and optimising synergies.

DFCC Bank has always been evolving and changing to suit the demands of Sri Lanka’s evolving and growing economy, while continuing to focus on its development mandate. We could not have survived and remained relevant for six decades otherwise. Starting from the early 90s, the bank began a journey towards becoming a financial services group which culminated with the acquisition of DFCC Vardhana Bank in 2003. Since then, DFCC Vardhana Bank has been functioning as DFCC Bank’s commercial banking subsidiary – a unique model which provided for diversification and a more prudent balance of risk and return.

Our thinking has always been to amalgamate the banks, but there were legal constraints. In January this year, these constraints were removed and since then, we have been working to transform DFCC and DVB into one amalgamated, full-service bank that is capable of providing the entire gamut of development and commercial banking services. During the past months, we assessed the pros and cons, and came to the conclusion that the combined size and reach of the amalgamated entity, and the synergies it will provide, will position DFCC to be able to deliver sustainable solutions for all stakeholders by creating a powerful platform for growth.

It is doubly significant that we achieve this milestone at the same time that DFCC celebrates its Diamond Jubilee, having been incorporated on 4 October 1955. The amalgamated bank will build on 60 years of heritage with the dedicated, vastly experienced and competent team at DFCC, and the young, vibrant and enthusiastic team at DVB – an unbeatable combination!

 

Q: What are the benefits of this merger?

A: Firstly, it creates an integrated platform to drive long-term growth by bringing together the various teams of both banks under one umbrella, cutting out the need for the same things to be done by both entities, and will enable us to work as one, with greater focus, to achieve our strategic objectives.

Secondly, it will definitely enhance long-term shareholder value through revenue growth, cost synergies and greater corporate efficiencies.

Finally, the combined entity will offer customers a broader range of financial solutions across all segments and geographies in the country. 

 

Q: How are things going with the transition so far?

A: I am happy to say that things are going incredibly well. The relationship between the banks is excellent, people are used to working with each other, the culture is similar, and the objectives common.

Even beyond culture, the people in both banks are very professional – passionate and committed about what they do. Professionals will always adapt to an environment which will allow them to develop and grow, along with the organisation they work for. To ensure that everyone gets a fair shake, we have independent consultants on board, to guide us every step of the way.

 

Q: What about from the clients’ perspective? How does this impact them?

A: Our customers will definitely benefit, as we will be able to provide them with a wider range of products and services and enhance our island wide footprint. Both banks have an extremely customer focused mentality, and provide solutions and services which consistently exceed expectations. Clients of both banks can now look forward to receiving this service from one, integrated bank, all over the island.

We plan to introduce innovative solutions, delivering significant value, in the future.

 

Q: How has staff reacted to this news? Do you anticipate any staff reductions as a result of the merger?

A: As I said before, our people are professionals, and all any professional needs, is a level playing field, and we provide that. There is great enthusiasm among the staff about the amalgamation. We have taken pains to see that no one is disenfranchised, left out, or deprived of an existing benefit. Where there are differences, the better option is provided to all.

There will be no reduction of staff. We value all our people, and with the growth opportunities that will come from becoming a bigger bank, the opportunities for advancement are open to all enterprising and dynamic individuals.

We have teams of experts at both DFCC and DVB who have pioneered innovative products and services, which are at the forefront of the banking industry. We will foster and encourage these people to continue these initiatives for the benefit of our customers and other stakeholders. Opportunities abound for those willing to take advantage.

 

Q:  Tell us a bit about the Governance and Management Structure post merger

A: The existing board of directors, nine at present, will continue initially, with three new directors from DVB being appointed later, subject to Central Bank approval. One of them will be Lakshman Silva, the current CEO of DVB, who will also be the Deputy CEO of the amalgamated Bank. Arjun Fernando will, of course, continue as CEO/Director.

 

Q: When do you expect to launch the new entity?

A: We expect to launch by 1 October subject to receiving approvals from the Central Bank of Sri Lanka and the Registrar General of Companies. We have already received the approval from Shareholders of both Banks at the Extraordinary General Meetings held recently.

 

Q: What are the plans of the new entity in the future?

A: We have great plans for the future. We will continue supporting individuals, businesses and the community, as we have done for 60 years, and our customers can look forward to enhanced service standards, with new and innovative products which we hope to unveil in the not too distant future. DFCC has served Sri Lanka’s development needs for decades, without profit being the main consideration. There are plenty of established corporates who will attest to this. We will continue to provide this service, and now, as a commercial bank, we will expand the services we provide to include those that are relevant to our customers in today’s economy.