Recapitalization of Seylan Bank PLC
The Monetary Board said that Seylan Bank PLC has continued its
operations over the past six months in a manner so as to build public
confidence, trust and acceptance.
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Seylan Bank branch in Colombo |
In particular, the current Board of Directors, with the assistance of
the Bank of Ceylon, has steered the bank to engage in normal banking
operations in a successful manner and thereby stabilize the bank.
The Monetary Board said that an infusion of new capital into the bank
should now be arranged for its future operations.
The bank has been directed by the Monetary Board to issue an
appropriate number of voting shares so as to generate a capital infusion
of around Rs. 3 billion by end August.
`Seylan Bank PLC will be required to invite investments from a few
state institutions so that such institutions could collectively invest
approximately 33 percent of the ordinary shares of the bank.
The existing shareholders and other new local and foreign investors
too, could participate in the new share issue, which is expected to take
place in August this year.
The new infusion of capital is expected to significantly strengthen
the operations of the bank as well as ensure its stability and soundness
in the long term. In the meantime, the Central Bank has called upon the
Bank of Ceylon to continue with its managerial assistance to Seylan Bank
PLC, and the current Directors to continue to serve on the Board. Three
new Directors are also expected to be invited to join the Board, after
the share issue. |
