By Chandeepa Wettasinghe
The top management of Union Bank of Colombo PLC (UBC) said its subsidiary UB Finance Company Limited has fulfilled all the obligations it has towards the depositors of the former Ceylinco group company, Finance & Guarantee Company Limited (F&G).
The Central Bank sold the bankrupt F&G to UBC in 2011, which renamed the company as UB Finance Company.
The Janatha Vimukthi Peramuna (JVP) last week accused UBC of not fulfilling the terms agreed with the depositors.
“It’s a dangerous accusation. This is the only company that can say we have really turned around properly. No other company has turned itself around properly. So it hurts a lot to get accused like this,” a UBC senior spokesman told Mirror Business under condition of anonymity.
UB Finance Director/CEO Ransith Karunaratne said that the Central Bank had converted 50.33 percent of the F&G depositors’ deposits into non-voting shares prior to selling the company to UBC, which had bought out the remaining 49.77 percent of the deposits.
“So their exit for the shares is through a Colombo Stock Exchange listing, which will happen over the next three weeks,” Karunaratne added. He said that UB Finance had applied to the Securities and Exchange Commission (SEC) with a request to go public, but the latter had raised three issues which required attention before a listing.
“The SEC looks at the old issues. So we have asked the SEC to sit down with us and the Central Bank to explain each issue. We are fully compliant with the Central Bank regulations,” the senior spokesman added.
He went on to say that even though UBC has spent a considerable amount of money on litigation costs to fight cases brought on against the previous management, some issues still remain unsolved.
In response to the JVP, Prime Minister Ranil Wickremesinghe in parliament said that he had instructed the Central Bank to present a report on the issue and is awaiting the document.