25 August 2017 09:04 am
Hatton National Bank PLC (HNB) has provided as much as Rs.400 million from its group profits on account of investments made in government securities by one of its subsidiaries through the troubled primary dealer, Entrust Securities.
HNB Grameen Finance Limited, HNB’s microfinance arm, had bought government securities worth of Rs.400 millions through Entrust Securities in the past but the latter got into a chronic liquidity and insolvency crisis during the latter part of 2015 as a result of alleged fraudulent use of funds placed by customers for investment in government securities.
Although the assurances from the Central Bank to settle the investors by way of cash as well as allocation of fresh government securities, HNB acting in prudence, has decided to keep some of its profits away on account of this investment.
In October, last year, the Monetary Board decided to settle investments secured with government securities amounting to Rs.3.1 billion belonging to 107 investors of the embattled primary dealer within few weeks.
In respect of the unsecured investments in Entrust amounting to Rs. 8.5 billion belonging to 24 individuals and entities, government securities will be allocated and be repaid under the repayment plan to be implemented with the managing support of Seylan Bank PLC, the Central Bank said.
Hatton National Bank PLC (HNB) has provided as much as Rs.400 million from its group profits on account of investments made in government securities by one of its subsidiaries through the troubled primary dealer, Entrust Securities.
HNB Grameen Finance Limited, HNB’s microfinance arm, had bought government securities worth of Rs.400 millions through Entrust Securities in the past but the latter got into a chronic liquidity and insolvency crisis during the latter part of 2015 as a result of alleged fraudulent use of funds placed by customers for investment in government securities.
Although the assurances from the Central Bank to settle the investors by way of cash as well as allocation of fresh government securities, HNB acting in prudence, has decided to keep some of its profits away on account of this investment.
In October, last year, the Monetary Board decided to settle investments secured with government securities amounting to Rs.3.1 billion belonging to 107 investors of the embattled primary dealer within few weeks.
In respect of the unsecured investments in Entrust amounting to Rs. 8.5 billion belonging to 24 individuals and entities, government securities will be allocated and be repaid under the repayment plan to be implemented with the managing support of Seylan Bank PLC, the Central Bank said.