The Cabinet granted approved for a letter of comfort for the cash-strapped Ceylon Electricity Board (CEB) to get further credit facilities from the state banks and the Ceylon Petroleum Corporation (CPC), the Daily Mirror learns.
A letter of comfort is a legal guarantee given to a bank by a third party or the government in this instance.
The CEB has already obtained Rs.96 billion from the state banks including Samurdhi Bank. Besides, it owes Rs. 80 billion to the Ceylon Petroleum Corporation (CPC) and Rs.25 billion to independent power producers (IPP).
For the People’s Bank alone, the CEB is in arrears of Rs. 66 billion. The CEB secured Cabinet approval to get fuel from the CPC on credit up to Rs.100 billion. Also, it got approval to get credit facilities up to Rs.100 billion from the People’s bank. For the Samurdhi Bank alone, the CEB has to pay Rs.274 million. (Kelum Bandara)