Minister accuses banks of misusing Parate Execution rights

By Yohan Perera  

 Minister of Justice Wijeyadasa Rajapakshe this week alleged  that some banks have misused Parate Execution rights and are engaged in  some sort of mischief.  
“Parate execution is the right given to banks to auction  properties which customers keep as collateral when they borrow funds. 

Some banks sell properties that they take over from borrowers to their  close associates. 

These properties are resold at a higher price later,”  he said addressing a press conference organised by the President’s Media  Division yesterday.   

Wijeyadasa went on to say that banks are also making use of  the increasing land prices to make profits out of properties they  auction.   

“Parate execution has a long history. This was introduced  in Sri Lanka under the Roman-Dutch law. Only the state banks were given  the parate execution rights initially, but the right was given to private  banks in the 1980s,” he recalled.  

The Minister said the new legislation will be brought concerning parate execution soon.