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24 November 2017

Central Bank cancels CIFL licence

The licence granted to Central Investments and Finance has been cancelled by the Monetary Board of the Central Bank.

The Central Bank Monetary Board has taken this decision at its meeting held on Nov 6, 2017 and the decision has been taken to issue a notice of cancellation and a letter has been sent to the Colombo Stock Exchange and also the notice of cancellation was communicated to the company on November 17, 2017 the Central Bank said.

The decision has been taken in terms of Section 37 (1) of the Finance Business Act No. 42 of 2011 (FBA).

Monetary Board, however, said the Company may tender objections in writing to the Board, in which case the Board may consider the objection and further action may be determined.

The Monetary Board of the Central Bank in a letter to CSE further informs that future regulatory actions will be informed in due course.

A spokesman of the Depositors Association said that their depositors, deposited their hard earned money at CIFL on the cardinal ground that CIFL was issued a Business Finance License which was issued by the Central Bank of Sri Lanka.

The Central Bank also issued a press release on October 18, 2016 approving repayment scheme to the deposit holders, a part payment before December 31, 2017 and balance payment with interest within a reasonable period.

Under this circumstances deposit holders legitimate expectation was destroyed by the CBSL by issuing this notification. Deposit holders vehemently object this notification issued to cancel the license. “We have also found two foreign investors to bailout the CIFL.”