Director Changes

Mar 30, 2011 (LBO) – A director of Sri Lanka’s listed Commercial Bank of Ceylon has stepped down amid pressure from the state, deepening a controversy over recent appointment of state-connected officials to private listed banks. State funds hold large stakes in HNB. But a bank filing said the two directors were “non-executive/independent.” Commercial Bank said in a stock exchange filing that Ranjith Fernando had “decided to withdraw prior to considering his re-election by the shareholders” at an annual general meeting Wednesday.

The bank said Lakshman Hulugalle, director general of Sri Lanka’s media centre for national security, has been appointed to the board.

Ranjith Fernando has stepped down after the Employees’ Provident Fund and the Employees’ Trust Fund, both state managed funds of private citizens, and state-run Sri Lanka Insurance Corporation objected to his being re-elected and withdrew their earlier proxies.

The EPF which is managed by the Central Bank, increased its stake in Commercial Bank on Tuesday. The central bank had not objected to Fernando when he was first appointed.

Commercial Bank chairman Mahendra Amarasuriya had told the AGM that the state managed funds as well as SBI Investment Holdin