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CB issues guidelines to establish Business Revival Units in licensed banks to help rescue viable troubled businesses

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The Central Bank has issued guidelines for the establishment of Business Revival Units (BRU) in licensed banks to support the revival of viable businesses, the CBSL said in a statement on Wednesday (03).

The aim of setting up the BRUs is to assist both performing and non-performing borrowers of licensed banks whose businesses are fundamentally viable to revive, the statement said.

It said that the licensed banks have already established Post COVID-19 Revival Units and the CBSL has issued guidelines to strengthen the functions of the above units and reformulate such units as BRUs.

The enhanced scope of proposed BRUs will facilitate sustainable revival of viable businesses affected by the extraordinary macroeconomic conditions, the CBSL said.

The challenging macroeconomic conditions that prevailed during the recent years have disrupted businesses, adversely impacting the ability of borrowers to duly repay their loans, and thereby impairing the recovery process of licensed banks, the statement said.

The CBSL said licensed banks are required to have robust business revival and rehabilitation policies and procedures to support the revival of businesses, and large banks with more than 50 branches, may consider establishing BRUs at large branches/regional offices of banks, in order to support the revival of businesses of affected borrowers more effectively and efficiently.

CBSL added that the fundamental viability of a business is a key factor in the consideration of business revival by a licensed bank, and that in the viability assessment, both financial and non-financial indicators are taken into consideration.

The borrower’s continuous cooperation will be critical for the process of reviving a stressed business, CBSL said.

The business can be revived through both financial and operational restructuring tools and processes, and the selection of an appropriate set of revival tools is subject to the mutual agreement of parties involved in the revival process, CBSL said.

Licensed banks are required to establish BRUs by mid-May 2024, and be fully compliant with the requirements of the Circular by July 1, 2024, it said.

According to the Department of Census and Statistics about 20 percent of small and medium scale businesses had been closed down during COVID pandemic and the subsequent economic crisis.



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PSTA worse than PTA: FSP

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The Frontline Socialist Party (FSP) yesterday accused the government of seeking to use the proposed Protection of the State from Terrorism Act (PSTA) to suppress popular political activity, claiming that some of its provisions were more repressive than those of the Prevention of Terrorism Act (PTA).

FSP Education Secretary Pubudu Jayagoda told a media briefing, in Nugegoda, that the definition of terrorism in the Bill was so broad that it could be used to label almost any form of popular political activity as terrorism.

He said the Bill’s approach to defining terrorism was based largely on attempts to compel a government, or an international organisation, to do, or refrain from doing something, rather than on internationally recognised criteria, such as killings, causing serious bodily harm, kidnapping or acts intended to spread terror among the public.

Jayagoda also alleged that the Bill transferred substantial powers from the judiciary to the executive, while extending powers of arrest, investigation and detention to the armed forces, in addition to the police.

He claimed that the government had sought to portray the Bill as a replacement for the PTA while retaining or introducing provisions that could facilitate political victimisation and repression.

The FSP also questioned the government’s decision to proceed with the Bill, despite having previously sought public views on an earlier draft.

Jayagoda said a draft had been published earlier this year, with the period for public submissions ending on February 28, but the Bill subsequently gazetted was essentially the same draft with some provisions rearranged.

Jayagoda also referred to a letter reportedly sent by Attorney-at-Law Saliya Peiris, a member of a Committee, chaired by President’s Counsel Rienzie Arsecularatne, that had been appointed to draft the legislation. He said Peiris had stated, in the October 06 letter, that changes had been made to the draft prepared by the Committee.

“This means that even the Committee, appointed to prepare the Bill, was a deception,” Jayagoda alleged.

He said that the PSTA was fundamentally similar to the Anti-Terrorism Bill introduced by the previous government, in 2023, which the National People’s Power (NPP) opposed and challenged in court.

“If the NPP opposed that Bill then and is now bringing the same legislation before Parliament, the government must explain its position,” he said.

Jayagoda called on NPP MPs to oppose the PSTA in Parliament and urged trade unions and other groups to build a broad public movement against the legislation.

He challenged the government to an open debate on the Bill.

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Shiranthi R remanded until 13 Oct.

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Former First Lady Shiranthi Rajapaksa was yesterday remanded until 13 October after being produced before the Colombo Magistrate’s Court following her arrest by the Commission to Investigate Allegations of Bribery or Corruption (CIABOC).

Shiranthi, wife of former President Mahinda Rajapaksa, was arrested at her residence on Poorwarama Road, Kirulapone, after CIABOC officers recorded a statement from her for nearly two hours.

According to the CIABOC, the arrest was made over allegations that Rs. 10 million obtained from the National Savings Bank through the Siriliya Saviya organisation was misappropriated.

The money was allegedly obtained to provide a Computed Tomography (CT) scanner to the children’s hospital. Investigators allege that the scanner was not provided and that the funds were instead unlawfully used.

CIABOC is investigating alleged offences under the Public Property Act and corruption-related provisions in connection with the transaction and other financial activities involving Siriliya Saviya, which was headed by Rajapaksa.

Rajapaksa returned to Sri Lanka on Monday night on a flight from Malaysia after travelling overseas for medical treatment. She left for Singapore on 16 September after being admitted to a private hospital in Colombo on 15 September following an illness.

She had been due to appear before the Financial Crimes Investigation Division (FCID) on 13 October in connection with its investigation into the financial affairs of Siriliya Saviya.

Meanwhile, her lawyers filed an anticipatory bail application before the Maligakanda Magistrate’s Court on Monday, seeking an order preventing her arrest in connection with the FCID investigation.

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Former NSB Chairman Kariyawasam granted bail

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Former National Savings Bank (NSB) Chairman Pradeep Kariyawasam was yesterday granted bail by the Colombo Magistrate’s Court following his arrest by the Commission to Investigate Allegations of Bribery or Corruption (CIABOC).

Kariyawasam, husband of former Chief Justice Shirani Bandaranayake, was arrested in connection with the Bribery Commission’s investigation into the ‘Siriliya Saviya’ account linked to former First Lady Shiranthi Rajapaksa.

The investigation concerns financial activities involving the Siriliya Saviya initiative, which was headed by Rajapaksa, wife of former President Mahinda Rajapaksa.

CIABOC is continuing investigations into the alleged financial irregularities relating to the account.

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