Swarnamahal Finance investors to get 10% of their deposits from July

The Central Bank (CB) on Tuesday ordered the Swarnamahal Financial Services PLC (SFSP) to pay “urgently” 10 per cent of deposit liabilities of SFSP to depositors effective from July 10.

In a statement, the banking regulator said the directive followed appeals by depositors. Earlier on January 2, 2018, the CB took over the affairs of SFSP and ETI Finance Ltd (ETIF) owing to their weak financial position and restricted the withdrawal of deposits. The CB appointed a panel to manage the affairs of the two companies.

“The details of the payment plan will be informed to depositors by SFSP shortly,” the CB said on Tuesday.

“The CB, while thanking all relevant parties for their assistance extended during the past six months, wishes to request all depositors to be patient until the business activities of SFSP are restructured and to cooperate with the CB appointed management panel for the implementation of such activities. Further information in this regard will be communicated in due course,” Tuesday’s statement said.

Last week CB Governor Dr. Indrajit Coomaraswamy told reporters that the CB was seeking another US$100 million financial infusion from a prospective investor to bail out ETIFL.

This sum of $100 million is needed to completely resurrect the company and meet all its liabilities of the firm in addition to the $75 million pledged by a Singaporean investor. The directors of the EAP Group have been given time till September 30 to bring $100 million in new capital or investors and settle the current balance of $32 million by next month.