Reminiscences
How Harry J’s Sampath Bank acquisition bid failed
****
Retired Chairman of Sampath Bank PLC,
Managing Director of Commercial Bank of Ceylon PLC, President of the
Banks’ Association of Sri Lanka and incumbent Chairman of Kahawatte
Plantations PLC, Group Chairman of Tokyo Cement Lanka PLC, Ceylon Tea
Marketing Services Ltd and Star Packaging Ltd Edgar Gunatunga
reminisces.
****
Ravi Ladduwahetty
The duty forecaster at the Meteorological Department’s Bauddhaloka
Mawatha complex might have recorded Friday noon’s temperature at 30.3
Degrees Celsius and the Relative Humidity at 85% but retired Sampath
Bank Chairman Edgar Gunatunga was seated cool as a cucumber at the
lounge of his Keppetipola Mawatha residence, reminiscing an illustrious
and elongated banking career spanning a record 55 years.
One incident which has been firmly entrenched in his mind was the
most hostile acquisition bid by Sampath Bank by business tycoon Harry
Jayawardena through the Hatton National Bank.
“The Central Bank put the lid on Harry’s Sampath acquisition as he
had exceeded the stipulated percentages of shares that any
individual/corporate could have in a licensed bank,” Edgar told Daily
News Business.
“Had the acquisition borne fruition, the running of Sampath Bank
would have been extremely arduous with there being no compatibility
between the cultures of Sampath and Hatton National Bank where the
management process and the staff management would have been totally
diametrically opposite, he said, and added that Harry’s nominees might
not have studied these aspects when the takeover bid was mulled.
Edgar Gunatunga nourishing his orchids in the same spirit he
nourished Sri Lanka’s banking industry.
Picture by Saliya Rupasinghe |
There had been two occasions that Edgar had wanted to retire but the
two issues made him stay longer than he had actually wanted.
The first was when Harry’s takeover bid and the latter was when there
was a dispute with the Nawaloka Group building at Nawam Mawatha which
Sampath acquired for its Head office at Rs. 500 million.
There was a small dispute on what was agreed and what was committed
and a question of pricing, he reminisced.
Edgar, an alumnus of St. Benedict’s College, Kotahena, joined the
Colombo branch of then UK owned Eastern Bank as a Junior Clerk whose 40
per cent was held by Standard Chartered Bank.
Disillusioned after two years, he left and proceeded to England, the
then practice of his family and friends. He joined the Head Office who
hired him as a Management Trainee on the understanding that he studies,
qualifies and returns to the Colombo office as a Senior Officer. He read
for his Banking examinations and returned to Sri Lanka prematurely due
to family commitments.
Edgar might be rewriting the record books in the Sri Lankan banking
arena. This was one of the few sparse instances where a school-leaver
joined a bank as a junior clerk and rose up to be Managing Director
while emerging as Deputy Chairman/ CEO and Chairman of another.
It was with obvious pride that he had recently told an old English
banker colleague that he had completed 56 uninterrupted years of banking
and the friend in turn had vowed that Edgar had merited a listing in the
coveted Guinness book of world records.
Rich experiences
Some of the richest experiences that Edgar had were as Jaffna Manager
of Commercial Bank, then largest outstation branch. Business was brisk.
He was promoted as Covenanted Officer with powers of Attorney. ( Blue
chips such as Aitken Spence have a parallel known as Per Pro, short for
Latin term Per Procurentum). One of the hair rising experiences he had
was when he broke open the stores of a smuggler to whom the Bank had
loaned money, which was later unrecoverable.
The smuggler had escaped to India. Communications was not as
developed as now and getting through to the Colombo head office was a
nightmare so I had to take this unpalatable decision, he mused.
He was brought to Colombo and was promoted Accountant of the Bank and
then Deputy General Manager and Managing Director.
As Accountant, he once ran down Bristol Street and caught a man who
cashed a forged cheque and assaulted him.
Forged cheques were a frequent phenomenon then and when I summoned
the police, they said: “Congratulations, Mr Gunatunga, you have caught
the ring leader.
On retirement from Commercial Bank, he was wanted as the Managing
Director of Sampath Bank, which was going through a crisis and a run on
the deposits.
He refused any banking appointments, but passionate pleas by the then
Governor A.S. Jayawardena and the Sampath Board, he relented. He joined
as the Deputy Chairman/ CEO. A morning private daily ran a double column
front paged story in a headline in reverse fonts: “Edgar joins Sampath”
The market confidence was restored.
He was promoted Chairman succeeding Dunstan De Alwis.
Sampath which had a mere seven branches at the time he joined and
with mediocre profits had grown and had over 100 branches and over Rs.
One Billion in profits when Edgar retired.
“Sampath had a good set of bankers and a good IT system and all I did
was to provide the leadership,” he said.
Hilarious incident
Edgar recalled a hilarious incident while he was at Commercial Bank
of Ceylon while he was also simultaneously the President of the Banks’
Association of Sri Lanka.
He had a set of friends whom he described as “naughty” were
constantly giving him nuisance calls during the lunch interval. The
repetitive cry was: “This is Menikdiwela here, H.E. the President wants
to see you in 20 minutes. He rebutted: “Tell your bloody President that
Gunatunga is at lunch.
Repeated the fourth time, Edgar was furious. He held on to latch the
background voices to nab the culprits. Lo and behold. He could hear
President Jayewardene’s voice in the background. Then it transpired that
the real caller was W.M.P.B. Menikdiwela, Secretary to the President.
Edgar finished lunch and was at the President’s House in 20 minutes.
President Jayewardene on seeing him asked: “Gunatunga, are you after
lunch? Edgar sardonically rebutted: “Sir, if I did not have my lunch, I
would not have been here.”
The real reason for President Jayewardene summoning Edgar, as it
later transpired, was to stop him and his Association members from
providing loans to a private newspaper group (name withheld) which was
attacking him and his Government. Edgar said: “Sir, I wish you had not
made that request of me.” Jayewardene thundered acidly:“ Gunatunga, I
will have you sacked in two days.”
To which school did you go to? The President asked in lighter vein.
Edgar was pushed into a groove.
Edgar, despite being an old Benedictine, was acutely conscious of
President Jayewardene’s awareness of his Sedawatte family connections.
Pat came the reply: “Sir, I am old boy of Sedawatte Madya Maha Vidyalaya.
“The entire conversation and the veiled threat were digressed.
Jayewardene then talked about the connections between Sedawatte and the
Kelaniya temple in which he had family connections. Edgar escaped
unscathed.
Later, Edgar was introduced to Jayewardene at a party long after the
latter relinquished office. Jayewardene said: “I cannot forget his face
as he is the only one who refused me a favour in my 11-year-old
Presidency.”
Then it was President Dingiri Banda Wijetunga who had the notorious
habit of waking him at 6 am on Sundays to find out how many jobs Edgar
had for his Yatinuwara electorate. Edgar rebutted: “Mr. President,
Sunday is the only day I sleep till late. Please do not disturb me at
this time. Bang. Bang. The phone was slammed in poor President
Wijetunga’s ear.
Spanish footwear for export market
The Board of Investment of Sri Lanka (BOI) granted investment
approval to ICL Robusta (Pvt) Ltd. for a project to manufacture footwear
for the export market.
BOI Board Member Channa Palansuriya signed the agreement on behalf of
the BOI and presented the BOI Certificate of Registrations to Zakir Abdi,
Director, ICL Robusta (Pvt) Ltd.
ICL Robusta is a joint venture project of Industrial Clothings
Limited (ICL), Sri Lanka and Calzados Robusta S.L, Spain. The venture
has been set up with the objective of producing high quality safety
shoes and uppers in Sri Lanka for international markets, such as the
European Union.
The company will produce custom manufactured high quality safety
shoes that are need specific. Abdi said that there is a high demand for
high quality safety footwear.
The company will provide reliable, cost effective, high quality and
scientific footwear solutions under the “Robusta” brand to the
international markets with innovative designs. Abdi also said that the
safety footwear is comfortable to wear and provides the maximum safety.
Abdi said that industrial workers all around the world face the risk
of accidents at the workplace. The shoes made by Calzados Robusta were
popular in the European Union since they met high standards of safety.
These shoes have re-enforced toe caps while some models even have a
metal plate to safeguard workers who may step on a sharp metal object
like a nail.
Industrial Clothings Limited, a BOI enterprise was established in
1979 in Sri Lanka. At present, ICL has a workforce of approximately 900
employees and produces all kinds of gloves, shoe uppers and sleeves
exclusively for the global markets. ICL is part of Midas Safety, an
international group, having operations in Canada, Pakistan, India,
Middle East China and Sri Lanka.
Calzados Robusta, a fully owned private company was set up in 1998 in
Spain to produce safety and scientific footwear for the domestic and
global markets.
This US $ 2.5 million investment project will generate 460 new direct
employment opportunities.
The production plant of company will be in the Katunayake Export
Processing. The Directors of the company Zakir Abdi and Sohail Ebrahim
signed the agreement on behalf of the company. |