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argills Bank, which officially opened its doors to the public yesterday, said it is currently negotiating with a company engaged in finance and leasing businesses under the finance sector consolidation process set in motion by the Central Bank.

“We are now looking at a finance plus leasing company. We are confident that we can merge in the near future—within the timelines provided by the Central Bank,” Cargills Bank Managing Director/CEO Harris Premaratne said.

That plan is still intact and soon you’ll be able to see banking outlets at selected Cargills supermarkets

In a bid to reduce the systemic risks stemming from a bloated finance sector, the Central Bank at the beginning of this year announced a consolidation plan encouraging larger finance companies and banks to merge with smaller ones.

Cargills received a provisional commercial banking licence in 2011 and a fully-fledged licence in the early part of this year.

The bank, with an initial capital base of Rs.5 billion, currently has its main branch in Bambalapitiya and plans to open up two more branches before the end of this month within Colombo.

“We are currently working on our IT system and once it is in place, we will be looking at expanding to outstations in the latter part of this year,” Premaratne said.
He also stressed that the earlier plan to set up Cargills Bank outlets at Cargills supermarkets is still on.

“That plan is still intact and soon you’ll be able to see banking outlets at selected Cargills supermarkets.”

Cargills (Ceylon) PLC has the largest supermarket chain in the country with over 200 outlets.

Cargills Bank, which was earlier named as Cargills Agriculture and Commercial Bank, hopes to focus on developing small entrepreneurs while being engaged in other more conventional commercial banking activities.

“Developing the small entrepreneurs is our ultimate goal. So, the emphasis would be on SME banking. We are also planning to finance the small suppliers to Cargills supermarkets,” Premaratne said.

EPF (Employees’ Provident Fund) is also actively negotiating for a stake in the bank

Promoters Cargills (Ceylon) PLC and CT Holdings own 15 percent each of the bank, while International Finance Corporation (IFC) and German Development Bank DEG own 10 percent each.

Meanwhile, the big local business houses such as MAS, MJF Group, Softlogic, Melwa Group, Hirdaramani Group, Phoenix Ventures, Lalan Rubber, Ishara Traders and Abans have also invested in the bank.

“About 3 percent of the bank is with the employees. Currently we have about 150 employees,” Premaratne noted.

“The EPF (Employees’ Provident Fund) is also actively negotiating for a stake in the bank,” he added.