Credit Plans

Dec 20, 2010 (LBO) – Sri Lanka’s Sampath Bank is expecting loans to grow 30 percent in 2011 helped by a new push into leisure, renewable power and credit cards as the country recovers from a three-decade war, officials said. Director Ranjith Samaranayake said the award was in part given due to its 3.0 percent credit growth in 2009, when loans contracted in most banks.

An upturn in tourism after a war ended in May 2009 has sent businesses scrambling to plan new hotels, with top groups including John Keells, Aitken Spence and Jetwing unveiling expansion plans or new projects.

“Already a few hotels are discussing with us,” chief executive Harris Premaratne said.

“There is a gestation period for projects because environmental and other approvals are needed.”

Sampath was looking at funding project in the East of the country, in Kalpitiya in the northwestern coast and also Colombo.

Premaratne says the country needs new hotels, as existing rooms are not enough to cope with expected peace-time demand. This year arrivals are expected to top 620,000.

Sampath will give dollar denominated floating rate loans linked to the London Interbank offered rate to hotels which have foreign exchange revenues to hedge