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By Chandeepa Wettasinghe
The Central Bank (CB) will be repaying the 7,000 depositors of the Ceylinco group’s Golden Key Credit Card Co. Ltd 40 percent of their Rs.26 billion in deposits starting from May 18, if the depositors agree to drop the 29 court cases against the company.

“If they remove all the court cases during the next hearings on May 18, we can pay depositors with values of Rs.2 million within a month, less than Rs.10 million within two months and settle all within a year,” Finance Minister Ravi Karunanayake said at a meeting held to hear out the depositors’ grievances.
The depositors insisted that a written assurance be given.

“We will forward a written agreement to the Supreme Court as soon as the last case is dropped,” Karunanayake said.

He said that there have been two factions of depositors in Golden Key; both have assented to the Central Bank taking over the payment scheme the Supreme Court had recommended.
 

‘‘If they remove all the court cases during the next hearings on May 18, we can pay depositors with values of Rs.2 million within a month, less than Rs.10 million within two months and settle all within a year"

If the case had continued and Golden Key was liquidated, only Rs.1.3 billion would have been raised.

Meanwhile, a depositor requested all depositors be paid equal amounts of Rs.2 million and Rs.10 million, etc., as time goes on, instead of leaving those above Rs.10 million without payment for a year, since all depositors have suffered equally.

Central Bank Governor Arjuna Mahendran said that this can be facilitated, to which Karunanayake too gave the approval.

The relief was proposed during the interim budget in January.

Karunanayake said that action was delayed due to other important matters that had arisen in the country and the President and Prime Minister had now asked the matter be swiftly resolved.

Karunanayake added a 15-member committee elected by the governor would act as a watchdog, while a board of directors and auditor selected by the Central Bank, with Mahendran acting as the CEO, would be appointed to Golden Key to track down all assets, liquidate and pay on a pro rata basis.

“(We will) go after each and every conceivable asset that is known or unknown to you or to us, so any benefit we get there, which is not agreed by the Supreme Court, will be given to the depositors,” he said.

Karunanayake added that all investigations and any further legal action that would have to be taken would be initiated by the Central Bank, which would also bear all the costs.

He said that the action did not constitute any political intrigue.

However, he failed to mention whether any action would be taken against former Ceylinco Group Chairman Lalith Kotelawala or the senior management that bore ultimate responsibility for the group’s operations.

All taxpayers in the country would bear the burden of Karunanayake’s decision, while no party has been brought to justice and compelled to pay the due.
In late 2008, a major segment of the 450 companies in the Ceylinco group collapsed. While the deposits in Golden Key were valued at Rs.27 billion in the balance sheet, only Rs.7 billion had been available.