Online edition of Sunday Observer

The ceremonial opening of the Golden Jubilee Assembly Meeting of the South Asian Federation of Accountants was held last week at the Institute of Chartered Accountants Sri Lanka (ICASL) Auditorium. A highlight of the event was the presentation of awards to winners of the best corporate awards in South Asia - Hayleys and Commercial Bank of Ceylon Ltd. Here R.W. Prasanna Indrajith, Manager Finance of Commercial Bank receives the award from the chief guest, Minister of Foreign Affairs Tyronne Fernando. Also in the picture are Vice President ICASL Indrajith Fernando and President ICASL Asite Talwatte. Pic: by Roland Perera

The Pramuka Stakeholders Association and Employees Union of the Pramuka Savings and Development Bank (PSDB) welcomed the Court of Appeal decision last week to remove the cancellation of the PSDB licence by the Monetary Board of the Central Bank. It appealed to the Central Bank to get actively involved in reviving the bank.

The Court ruled that it was dissatisfied with the manner in which the Monetary Board had arrived at the decision and directed the Central Bank to take alternative measures available in terms of the Banking Act to safeguard the interests of depositors. President of the Pramuka Bank Employees Union, Sunimal Dabare said: "We welcome this decision and are appealing to the Central Bank to actively get involved in the revival of the PSDB. According to the Court ruling, the Central Bank can take any step to revive the bank".

A Central Bank spokesman, who did not want to be quoted, said that they will consult their legal experts and get their opinion on what action needs to be taken. The Central Bank Governor is out of the country, and the two deputy governers could not be contacted. K.C. Vignarajah, the chairman nominated by the Stakeholders Association, said: "The stakeholders including the depositors and employees welcome the Court ruling as a liquidation process would have taken around 8 to 10 years. There have already been four suicides and 12 heart attack cases and some depositors are in a pathetic situation".

He said everybody including the public should support the bank to start clean. Vignarajah said the main reasons for the Central Bank's decision to close PSDB were the "horrible balance sheet and the lack of confidence they had in the previous management".

Therefore, he was confident that Central Bank will extend its fullest support to revive the bank under a new management "In the meantime, we have contacted borrowers and depositors and are in the process of collecting data about defaulters. The lack of data hampers our work. Though we have requested the Central Bank to release the required data, due to confidentiality reasons, they will not release this to us. Therefore, we are not in a situation to exactly gauge the financial position of the bank, but we will ensure that we collect every cent due to the bank once we are operational." Asked when PSDB will be opened, he said this will be decided by the management in accordance with and guidance from the Central Bank.

The Monetary Board filed an appeal last Thursday with the Supreme Court, seeking to set aside the Court of Appeal order. Pramuka Bank had 160 employees and 15,000 account holders. The operations of the five-year old bank were suspended on October 25, 2002 by the Central Bank which decided to wind up the business and cancel the licence of PSDB on December 19.