Turnaround at TFC: Profits after 2 1/2 years

Decision-makers and stakeholders of The Finance Company PLC (TFC) can look with satisfaction at the company’s performance over the last quarter as the company has been able to record profits after two and a half years.

The financial crisis that hit markets globally has been particularly harsh on the financial services industry. TFC needed a steadying factor to weather the storms it faced. This came through the guidance of the Central Bank of Sri Lanka along with members of the Cabinet sub committee appointed for resurrecting the finance sector and managing agents appointed to oversee operations of TFC.

Given the scale on how firms were affected during this time and while the competition was still looking for a foothold within a stricken market, the turnaround achieved by TFC in such a short period is remarkable.

One of the most significant factors that have been instrumental in the turnaround is the new board of directors who have taken charge of steering the organisation with a new vision.

The share issue, which was oversubscribed and concluded in January, saw important changes within the ownership structure of the company. More significantly, it saw the positioning of the State banks - People’s Bank, Bank of Ceylon and Seylan Bank as the key shareholders of the company. TFC is the only non-banking financial entity in the country that has the support of these principal state-banking institutions.

Pawning, which had seen a sharp rise during the last quarter, ended with an impressive overall growth of 64 percent and the leasing and hire purchase product portfolio was 50 percent in the first quarter. Overall monthly investments reached the Rs.1 billion mark with over Rs.500 million in monthly new deposits.