Nov 18, 2009 (LBO) – Sri Lanka’s The Finance Company, which ran out of capital at the end of the September 2009 quarter, said it was cutting deposit rates and has called a meeting of shareholders on December 11. The firm had lost 1.528 billion during the six months to September 2009, had lost its capital and ended up with 50 million rupees in negative net assets.
The firm said in a stock exchange filing that it had called an extraordinary general meeting on December 11 due to “serious loss of capital”.
It was cutting the interest rate on fixed deposits to 10 to 12.5 percent a year from November 15 and on ‘nominal and minor’ savings deposits to 8.0 percent.
It was also looking “to obtain assets to the value of the loan granted” to reduce loan loss provisions.
It will negotiate with banks to reduce the interest rates on borrowings, and dispose of land stock of the company.
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The Finance is being managed by the Merchant Bank of Sri Lanka under the supervision of the island’s banking regulator, the Central Bank.