|
Foreign
investors boost Union Bank
By Darshana Abayasingha
Union Bank readied itself for the Central Bank’s 2009 Tier
One Capital Requirement programme for all commercial banks, with
significant investments by Prince Faisal Al Faisal Bin Abduallah
Al Saud from the Kingdom Of Saudi Arabia and investment banker Alex
Lovell.
The two investors infused a total of Rs.420 million, on top of Rs.
500 million already committed by its existing major shareholders.
Both Lovell and Prince Al Saud would each acquire 10 per cent of
Union bank’s shares.
The Central Bank Of Sri Lanka requires all licensed commercial banks
to be compliant with its minimum capital requirement of Rs. 2.5
billion by end 2009. A proud Union Bank Chairman, Ajita de Zoysa,
expressed confidence to The Bottom Line that his institution would
be complaint, adding that the bank had already reached the stipulated
figure for 2008. He pointed to the new investments as “part
of its proactive and successful efforts to achieve this target (2009)”.
“We are looking at an Initial Public Offering to raise some
of the remaining capital, and we are positive of a good response
given the confidence in the bank as evident. The investments by
Prince Al Saud and Mr. Lovell demonstrate the potential and confidence
the bank exudes. It was done after careful evaluation, and it is
also a good reflection four our country – a mark of confidence
in our economy,” de Zoysa said. He earlier stated that “it
is a collective responsibility” to achieve stability in the
nation to attract diverse foreign investments into the country.
De Zoysa added that the company would soon implement a branch expansion
plan, coupled with a programme to drive its banking products among
customers. The planned expansion would not be restricted to urban
areas, whilst some new products would be developed to suit the times.
In doing so, the bank would now have the opportunity to draw upon
the expertise and knowledge of its two new shareholders who bring
with them a wealth of experience with the industry.
Union Bank’s income increased 41.8 percent to one billion rupees
last year, whereas it’s after tax profit increased to 51.1
million from 5.6 million rupees during the same period. In 2006,
the company’s total assets stood at 9.082 billion rupees. Total
deposits increased to 7.807 billion rupees from 6.866 billion.
|
