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 Kamal Jayantha Yatawara /The Finance Company Director and CEO

The Finance regains public confidence

Full name - Kamal Jayantha Yatawara

School attended - Royal College, Colombo

Civil status - Married, has a daughter and son


The Finance Company PLC which is a path breaking institution in the real estate and finance industry in Sri Lanka is thriving to expand its footprint islandwide with the introduction of unmatched and customer centric products to the Sri Lankan market.

Despite the obstacles faced by the finance industry in Sri Lanka, The Finance Company managed to register an impressive growth rate in recent times while regaining public confidence that was lost during the recent past. Daily News Business interviewed The Finance Company Director and CEO Kamal Yatawara for the Tea with CEO column.

Here are the excerpts of the interview:

Q: Could you give us an overview of how you entered this field and how you came to this position?

A: I started my career in the field of accounting at Walkers and Sons and then entered the marketing field at Unilever and worked there for 10 years. Later, I saw opportunities in this company and joined as a Branch Manager 23 years ago. Within the period of five years, I got into the senior management.

I also had some foreign exposure and worked as a CEO in a IT company in Malaysia which is a subsidiary of the Ceylinco group. I was involved in restructuring a finance company in Nepal. Later, I was appointed to the board six years ago in The Finance Company PLC.


Kamal Yatawara. Picture by Saliya Rupasinghe

When the Ceylinco Group was hit with the crisis, Central Bank had to take control of affected companies ,at that time I was appointed as the CEO of The Finance Company.

Q: Your company was affected in the face of global financial crisis and various issues of some institutions in the Ceylinco Group. As the CEO of the company, what kind of strategy did you adopt to regain public confidence in your company?

A: At first, I had to instill and regain lost public confidence. To do this, I needed the support of my staff and we had to ensure that we keep to our promises. We took great efforts to pay the interest of depositors on time, while keeping the morale of the staff intact.

With the support of directors and the Central Bank (CB), we were able to come out of the crisis. The Central Bank supported us at the time of crisis by appointing managing agents for all affected FCs. With this, we managed to restore public confidence to a greater extent.

Thanks to the manner in which the CB handled the situation, none of the financial companies had to close down in Sri Lanka. This happened without CB pumping a cent to these organizations.

Then the biggest advantage we had at the time of crisis, our monthly recovery from the loan given was over one billion a month, with that we were able to pay depositor interests and manage overheads while doing investments in a small way. What the CB did was to convert part of fixed deposit liability to equity of the company in a small way. However, many small finance companies had to do it on a greater scale. Converting the FD liability to equity will never be a loss situation for those customers who converted the FD liability to equity in the medium and long-term since it will have a value addition to the organization in time to come. From a situation where we were making losses we managed to revert to a situation where we are making profits and recorded impressive profit during the first quarter in this year, that was after three years.

With the present profit-making situation and other development activities that are taking place in the company, we are optimistic that the share price of the company would go up since there will be value addition to the organization. I am requesting all depositors who converted their deposits to equity not to rush the sell those shares, but to retain them to reap the benefits in the near future.

Q: What is the present status in the financial industry in Sri Lanka?

A: Prevailing low interest rates have a favourable effect on the finance and banking industry to a greater extent. When the borrowing rates are low, FCs and banks are able to lend at reasonable rates and people tend to start businesses.

Before the crisis, there was a time that the borrowing rates went up to 20 to 25 percent. It is very difficult for businesses to survive by borrowing at around 30 percent rate. Having a lower interest rate in the country will be a good trend for the economy, where the country is developing.

Q: What are your views on the real estate business in Sri Lanka?

A: Our main products are financing, basically financing of vehicles. In addition, we had a mixed bag of products. Forty percent of our business was in the real estate business before the crisis. We were the leaders in the real estate business at that time. As a result, we helped the Sri Lankan population to increase land ownership by giving them easy payment terms to pay for lands within 7 to 10 years.

Before the financial crisis, there were many players in the industry. As a result we had to buy lands at fairly high prices and create price at the time of sale. However, we have done eight successful projects after the crisis and managed to sell all projects at market prices or below the market price with all facilities within a period of four months. Before the crisis, we were doing projects with 200 to 300 blocks and now have restricted to a maximum of 60 blocks projects and complete these projects in six months.

As a result the cost of capital has come down and we are able to sell lands at affordable prices without creating a price or making a bubble.

Q: What is your greatest achievement in business?

A: My greatest achievement in business is turning The Finance Company from the crisis situation. There were some issues in several companies in the Ceylinco Group that were taking funds from the public and we were part of Ceylinco group and we had lost public confidence due to that situation. People even close to us did not believe that we could survive. It was so hard at first. But I think, to get the team together and also build public confidence and put it back on track is the biggest achievement that I had in my working life.

Q: What is your advice to young readers, who are interested in entering this field?

A: When you start working, you got to give 100 percent to achieve your organizational and personal goals. 'Work while you work and play while you play', that is the advice I can give to young readers.

Q: What are your interests and hobbies?

A: I enjoy mixing with people. I meet a lot of people and I really praise the value in interaction with everyone. In addition, I read, watch TV and listen to music.

Q: Where would you like to spend your holiday?

A: I cannot mention a specific place. However, even for a holiday, I prefer to go with a crowd.

Q: What sort of investment plan does your company have in mind in future?

A: We recently opened a branch in Wellawaya and thinking of business expansion in the North and East with a substantial amount of investment. Recently we opened a pawning centre in Nelliaddy. In addition, we see great potential in construction and tourism industries in liberated areas and with the improvements in these sectors, we are optimistic that we will have more business opportunities. We are also looking at expanding into the SMI and the agriculture sector and have nine branches with trained staff to do SMI loans. The company has a credit line that comes from CB to assist the agricultural and SMI sector.

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