Peoples Bank writes off Rs 5bn debt of Minister Daya Gamage

The People’s Bank amendment bill was passed in Parliament this afternoon with amendments.

The Parliament was adjourned without the opportunity for the reply speech in the adjournment motion on the university non-academic staff strike moved by the JVP.

The Peoples Bank amendment bill was put forward by the government, to increase authorized capital of the bank by issuing shares and debentures. The opposition claimed that this was an attempt to privatize the banking institution.

Today (September 19), the government agreed to one of the several amendments presented by the opposition, while the opposition was defeated when a vote was taken regarding the amendment.

UPFA MP Chandima Weerakkody noted that there is no problem in issuing debentures to further strengthen and protect these banks. However, their view is that the minister should take such decisions after obtaining the approval of the monetary board.

Mangala Samaraweera, Minister of Finance noted that they could not agree to this amendment, however, if they wanted a vote they could proceed.

JVP MP, Bimal Ratnayake stated that the biggest issue was that after issuing debentures if the banks run out of funds to settle them when they mature, will the government convert these debentures into equity shares? This is stated in the government’s circular, and therefore, the government cannot refrain from doing it.

Eran Wickremeratne, State Minister of Finance shared that approval must be sought from the Monetary Board of the Central Bank and without its approval the Bank of Ceylon or the National Savings Bank cannot issue any debentures. He added that it was similar to the Peoples Bank and shares of the Peoples Bank cannot be transferred to anyone.

Mangala Samaraweera, Minister of Finance went on to deny all these amendments.

MP Kanchana Wijesekara noted that he was informed that a certain minister that paid the electricity bill of Sirikotha, has requested the Peoples Bank to issue funds worth Rs 5bn to his company within the day. He went on to note that the certain minister has already obtained Rs 8bn from the Bank of Ceylon. He added that the government which promised the Volkswagon factories are requesting funds for another loan for a factory in Kuliyapitiya. MP Mahinda Yapa Abeywardana added that they were concerned whether Rs 10bn was obtained from state banks to buy over MPs to support the abolishing of the executive presidency.

MP Mahinda Yapa noted that loans worth Rs 5bn obtained by Minister Daya Gamage was written off as bad debt and the act was also passed to support this. The people of this country will stone and chase the government if it continues to operate like this.

While MP Bimal Ratnayaka presented the proposal for the non-academic staff protest and several MPs expressed their view in this regard, no member of the ruling party was present to answer the adjournment motion.