MBSL ventures into leisure industry

by Lalin FERNANDOPULLE

The Merchant Bank of Sri Lanka (MBSL) Group having successfully managed the defaulted financial institutions will venture into the leisure industry shortly, said Chairman, MBSL Group, Janaka Ratnayake.

He said a three-star 80-room city hotel is being constructed in Nallur, Jaffna which is now a tourist destination. The hotel will be opened in February 2011.

The MBSL will be venturing into the North and the East providing access to funding those who had been denied a better lifestyle for several years.

Despite a very challenging year the MBSL Group recorded a substantial growth in profits last year. The Group's gross income rose from Rs. 1,647 million to Rs. 2,385 million, recording a 45 percent growth over the last year.

The Group profit increased to Rs. 339 million last year from Rs. 242 million in 2008 recording a 40 percent growth over the previous year. The total assets of the Group stood at Rs. 7.5 billion as at December 31, 2008 increased to Rs. 11.8 billion in 2009 which is a growth of 56 percent during the year.

Ratnayake said within six months' businesses in all MBSL managed entities were restored regaining full confidence of depositors. MBSL accomplished a major task and now it is expanding businesses of the managed entities.

The Finance Company PLC (TFC) which had incurred a monthly loss of Rs. 250 million has been reduced to Rs. 50 million. The company paid Rs. 12 billion to depositors as capital repayment. TFC liabilities is over Rs. 21 billion.

"The company is paying interest to depositors and has commenced repayment of limited capital. It has been planned to reach break even level by the end of this year", Ratnayake said.

MBSL has been able to reduce the monthly operational loss of Asian Finance Limited (AFL) by Rs. 30 million and hope to reach break even within a short time.

MBSL Savings Bank previously known as Ceylinco Savings Bank recorded a profit of Rs. 40 million within a period of six months regaining confidence of depositors.

The Island Finance Company formerly known as F&G needs more time to fully recover due to the adverse publicity.

The company's operations were limited from May to September 2009 due to Court order.

The Ceylinco Building Society (CBS) and the Ceylinco Sussex Educational Ltd. (CSEL) are managed by MBSL.

MBSL was appointed as the management agent of TFC, AFC, Ceylinco Savings Bank and F&G Co Ltd. following the crisis that triggered in the Ceylinco Group last year.