CBSL formally announces cancellation of Swarnamahal Financial Services licence

Thursday, 29 December 2022 00:45 - - {{hitsCtrl.values.hits}}

The Central Bank yesterday announced that the Monetary Board decided to cancel the Finance Business Licence issued to Swarnamahal Financial Services PLC (SFSP), in terms of Section 37(3) of the Finance Business Act No. 42 of 2011 (FBA) with effect from 28 December 2022.

Accordingly, SFSP is not permitted to engage in Finance Business under the FBA with effect from 28 December 2022.

Further, Central Bank of Sri Lanka Department of Supervision of Non-Bank Financial Institutions Director has decided to cancel the Certificate of Registration of SFSP as a Registered Finance Leasing Establishment under the provisions of the Finance Leasing Act No. 56 of 2000.

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 Non-Bank Financial Institutions Sector” unclaimed deposit liability of SFSP will be transferred to SMBF along with the corresponding assets value and relevant depositor information.

The 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. 1.1 million 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.