CB mulls revival of six failed finance companies

The Central Bank (CB) is considering the possible revival of the six failed non-bank finance institutions (NBFI) via fresh capital infusions.

“NBFIS whose finance business license has been suspended or cancelled, are being reviewed to assess the way forward if such NBFIS are considered possible to be revived, develop plans to enable infusion of capital investment for revival, subject to a feasible business plan,” the CB announced.

Over past few years, licences of several NBFIS including The Finance Company PLC and ETI Finance were cancelled or suspended after running into severe liquidity issues and consequent futile attempts to revive those NBFIS with potential new investors.

CB Governor Ajith Nivard Cabraal stressed that possible revival of failed finance companies has to be seriously considered in order to provide relief to depositors and employees of those NBFIS.

Moving forward, the CB is expected to begin negotiations with potential investors of those selected NBFIS under the reviewing exercise.

In accordance with this, the CB also plans to make necessary interventions in court proceedings based on the respective action plans for these failed NBFIS.