Merchant Reach

Oct 02, 2009 (LBO) – Merchant Bank of Sri Lanka (MBSL) said it had raised its stake in Ceylinco Investment Company, part of the troubled Ceylinco group, to 46 percent, through a five million rupee cash injection. MBSL said in a statement it bought 500,000 shares of Ceylinco Investment Company at 10 rupees a share.

MBSL is a subsidiary of state-owned Bank of Ceylon, Sri Lanka largest commercial bank. The bank said in a stock exchange filing Ceylinco Investment Company has 37 percent holding in The Finance Company, another Ceylinco group firm which is currently being managed by MBSL.

MBSL was asked by the banking regulator, the Central Bank, to take over or manage several Ceylinco firms after the group got into trouble when the collapse of an unlisted credit card firm caused a run on several finance companies.