Swarnamahal Financial Services licence cancelled

The Monetary Board of the Central Bank of Sri Lanka yesterday announced the cancellation of the Finance Business Licence issued to Swarnamahal Financial Services PLC (SFSP), in terms of Section 37(3) of Finance Business Act, No. 42 of 2011 (FBA), with effect from December 28, 2022. 

Accordingly, SFSP is not permitted to engage in finance business, under the FBA, with effect from December
28, 2022. 

Further, the director of the Supervision of Non- Bank Financial Institutions Department of the Central Bank has decided to cancel the Certificate of Registration of SFSP as a Registered Finance Leasing Establishment, under the provisions of Finance Leasing Act, No. 56 of 2000.  

In view of the contribution made by SMB Finance PLC (SMBF) (then SMB Leasing PLC) to repay the remaining deposits of SFSP, as per the directions of the ‘Masterplan for Consolidation of Non-Bank Financial Institutions Sector’, the unclaimed deposit liability of SFSP will be transferred
to SMBF, 

along with the corresponding assets value and relevant depositor information, a Central Bank statement said.
Further, the Sri Lanka Deposit Insurance and Liquidity Support Scheme (SLDILSS) will take the necessary actions to pay compensation to the outstanding insured depositors of SFSP, up to a maximum of Rs.1.1 million per depositor, as per the regulations of the SLDILSS, in due course. 

Upon the transfer of unclaimed deposit to SMBF and payment of compensation through the SLDILSS, the entirety of the deposit liability of SFSP will be settled.