UB Finance ready for a new year

Tuesday, 31 December 2013 00:01 - - {{hitsCtrl.values.hits}}

Plans to list company in coming year and achieve profit between Rs.20-30 m

By Cheranka Mendis UB Finance will enter 2014 aiming for an Rs.20-30 million profit in the 2013/2014 financial year and with plans to list the company on the Colombo stock Exchange. LB Finance Chairman Alexis Lovell yesterday addressing the media noted that having ironed out the legacy issues that came with the distressed finance company when it was taken over by Union Bank from MBSL in November 2011, it is back on track to serve all stakeholders. Complying with international accounting standards, UB Finance’s current portfolio is in the region of Rs. 1.6 billion. “We are growing at approximately Rs. 175 million a month,” Lovell said. “Our target is to reach 200 million per month before the end of the year.” If all goes according to plan, 2014/2015 will herald in a “satisfying” number as profits, he asserted. “Under the guidelines provided by the Central Bank, we will take the company to listing in 2014. At the moment we are in the process of preparing the company for this endeavour. Although a specific date has not been set yet, this will be done as soon as possible,” he said. “We are happy to say we run this company as a public listed company. Our governance structures, etc., are according to international standards and are run accordingly.” Union Bank has 77% ownership controlling shares while the American fund, ShoreCap II, is its international strategic investment partner. Lovell reflected that key initiatives undertaken to turn the company around from its distressed state were to identify and put in place a Board of Directors and management capable of turning it around, identifying senior staff and rebuilding the company. “In order to rebuild the company what are crucial are the people, the processes, technology and business,” he said. Having identified the right human capital, UB Finance then worked towards a strategic intent, forming a five-year plan, setting up necessary technology to ensure accountability and developing the business aspect of the company. “Today we have sorted out most of our legacy issues,” he noted. As at last Friday, a new shareholder list has been lodged, which mainly consists of non-voting shares where deposits were converted to non-voting shares. “We had a lot of deficiency in that and we cannot take the company forward with a deficient shareholder list. This has been lodged in Court. I am sure it will be verified and approved. It took us over seven months to get it together.” In order to develop the business, they have also set up a sufficient branch network which includes Kurunegala, Negombo, Ambalangoda, Tissamaharama, Galle and Kadawatha. “From a business volume point of view, we have a target which we are confident of achieving by end of year, 31 March 2014. We are on track.”