| Com Bank-HNB-Seylan have all been Rajapakised |
(Lanka-e-News-20.June.2012, 11.55PM) The Standard and Poors international loan classification Institution had stated that the SL Banking sector is facing a grave peril as regards its economy and lending . In its grading the mark 1 is given to countries where the least peril exists and 10 is given to those where the peril is greatest . The grade allotted to SL is 8 . Tunisia , Kazhakastan are also in this same category , according to the Standard and Poors International.
The SL banking sector had been driven into this perilous state because of excessive lending, and if this trend continues , the entire country’s economy would crash , the Institution points out.
The Govt. Banks owning over 50% of the shares of the commercial market , is a reason for this, it adds.
What is implied in this warning is at present SL’s main private commercial Banks have all been Rajapakised, with the operations of Seylan , Commercial, Hatton National Bank etc . being taken over and controlled by the Govt. The Govt. did this through diabolic tactics. Using the EPF funds , the regime purchased more shares of Commercial Bank and Hatton National Bank , and took over the control of appointing the chairpersons to those Banks .
One illustration is the appointment of Lakshman Hulugala a henchman of the Rajapakse regime to the Board of Commercial Bank who knows next to nothing about Banking and has no educational and professional knowledge, and who had only passed the GCE exam
When the private Banks are trying to recover the loans , by relaxing the rules, the Banks have been forced to waive the loan recoveries of the Govt. henchmen who have taken loans. Consequently the collapse faced by the State Banks are being faced by the private Banks too.
A case in point is the loan of Rs. 9 million granted by Hatton National Bank to a henchman of MaRa from Balapitiya . The President himself has intervened and compelled the Bank when recovering the loan to reduce the loan repayment to one million . Despite the Bank having filed legal action for recovery , because of MaRa ‘s pressure the Bank lost Rs. 8 million in capital and interest.
The private Banking sector which had a history of growth and progress hitherto, is now owing to the Rajapakising fast heading towards disaster . This has been confirmed by the Standard and Poors Institution too in its report.
