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Sri Lanka Ceylinco group to exit Seylan Bank
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justman
Joined: Mar 2006
Posts: 1148
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 1 Jan 2009 21:10:11 GMT Report for Abuse
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Damed
Yes cylinco might lose ground if customers start withdrawing their deposits and have they got anywhere else to deposit?This company is well structured and their depositors cash is invested in real estate that is managed well that will bring devidents in future.I wish this group will not diversyfy or expand so rapidly with the monies taken from depositors as should there be a credit crunh or some one cause a panic then the company should be able meet the depositors demand to a limit only, as the depositors must be realistic that their money has been put to use on their ventures.This is a crisis of confidence that has been created by mischievous speculators that would have a devastating effect when there is a downturn in the economy as now. |
Joy09
Joined: Jan 2009
Posts: 11
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 2 Jan 2009 17:27:54 GMT Report for Abuse
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| The belief of many that the downturn in economy caused the collapse of GK is incorrect. Gk had been in trouble at least for the last four years. In any event Ceylinco's proposed divestment of Seylan is going to raise how much? As per the last accounts the Ceylinco holds only around 23% of seylan. Out of this, a number of Ceylinco companies holding shares are public companies and therefore Mr.LK cannot lay his hands on those monies. Therefore the maximum that he can raise by the divestment will be around RS. 300 Million which will be peanuts compared to the liability of Rs.27 Billion. Then the interesting question arises as to why he wants to divest Seylan? It is learnt that most of the Bank premises were sold to Ceylinco insurance a couple of months back and that the Bank is now paying rent on them. All most all vehicles owned by the Bank was sold to Ceylinco companies and leased back from them and the Bank is now paying lease rental on them. The head office building is owned by Ceylinco seylan development co and it is not a fully owned subsidiary of seylan as perceived by many people.Now you can see that the only asset of any value owned by the Bank is its lending portfolio. It is officially accepted that around 20% of the lending portfolio is bad although unofficially this figure is said to be much higher. Now you can see why he wants to divest Seylan. This is again a calculated move to make money out of a bank in trouble.I hope who ever wants to buy these shares will do a due diligence and know the exact position before falling for this latest swindle. |
Joy09
Joined: Jan 2009
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10 Jan 2009 02:20:49 GMT Report for Abuse
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| To all Facts and purposes Ceylinco has already divested Seyan. Wonder how? Ceylinco Fast cash in Singapore has to pay Rs. 4 to 5 Billion to Seylan Bank. It appears that this money will never come or will come very very slowly. Seylan would have already funded this amount either by its depositors monies or by borrowing in the call/money market. If a hypothetical interest rate of 16%p.a is taken(T.B rate is around 19%) the Bank will have to pay Rs.640 to 800 Million p.a to service this borrowing. Even if the entire Seylan bank is sold it will raise only around Rs.3 Billion at current market rates. Do you think LK is mad to pay Rs 5 Billion and raise probably around Rs 300 to 500 Million (his share of stake in Seylan). |
Joy09
Joined: Jan 2009
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12 Jan 2009 03:44:09 GMT Report for Abuse
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| In addition to my revelations here a further scam of Rs 3 Billion has come to light at Seylan Bank. It appears the bank has collected Rs 3 Billion under the grameen deposit scheme and given it to Ceylinco Grameen. Will this money be repaid by Ceylinco Grmeen is the biggest question. The bank does not hold any security for this loan. |
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