Foundation Stone

June 27, 2006 (LBO) – Sri Lanka’s President Mahinda Rajapakse Tuesday launched a new state-own development bank aimed at assisting small and medium scale entrepreneurs. The Lankaputhra Development Bank, kicked off with 1.5 billion rupee seed capital from the treasury, with a further 2.0 billion rupees expected from the Private Sector Infrastructure Development Fund.

“We are looking to assist people who are looking for financing requirements of over a million rupees,” Rajapakse, who is also the island’s finance minister, said.

Project finance loans are priced at 10.0 percent, savings rates at 11.5 percent and fixed deposits at 12.5 percent.

“Lending rates are competitive and we are opening branches throughout the island to assist people in their business plans,” the bank’s CEO Tuly Cooray said.

So far around 300 million rupees worth of deposits have been made, with some of the prime depositors including big corporate names like apparel manufacturer Brandix Lanka, Laugfs Gas and Korean Spa, receiving their paperwork from Rajapakse’s hand.

Officials said lending to eight projects worth around 100 million rupees have already been approved. Startin