Plc Case Study

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Central Investment & Finance PLC Background Ownership Central Investment & Finance Limited was established in 1966 by Mr Hinni Appuhami, the founder of Maliban Biscuits & remained as a family owned company for about four decades. In 2004, 74.5% stake of the company was acquired by Aspic Corporation (Private) Limited, a diversified Investment Management company. At the time of Acquisition, CIFL had a deposit base of Rs. 30 million & an accumulated loss of Rs. 12 million. CIFL was acquired with the motive of building a reputed financial arm for the Aspic Group enabling them to enter the financing market of Sri Lanka. The ownership structure of CIFL comprised of 74.59% with Aspic Corporation, 21.52% with Mr Deepthi Perera & 0.71%, 0.39%, 0.14%…show more content…
J K Wickremeratne. He joined CIFL in 2008 as the Chief Operating Officer. He commenced his career in the Commercial Bank of Ceylon PLC & has gained more than 31 years experience in local & foreign financial institutions. He has a professional affiliation from the Institute of Bankers (Canada). • Mr. S B Kondadeniya, an Executive Director of CIFL, joined the company in the year 2001 & has over 50 years experience in international & domestic banking & financing. He received training in International Banking at Commerz Bank in Germany & held positions as the Chief Manager of the People's Bank International Division. He was also the General Manager of CIFL from 2001 to 2004. • Dr. J D Jayakody, also an Executive Director, was appointed to the Board of Directors in 2011. He is also a director of the People's Bank, People's Leasing, People's Finance PLC , Peoples Leasing Fleet Management Limited, Peoples Leasing Property Development Limited & People's Leasing Havelock Properties Limited. He holds a B. Degree (Special) in Public Administration & MBA from the PIM of University of Sri Jayewardenepura. He is also a Member of Institute of Public Finance & Development Accounts, a member of Institute of Management of Sri Lanka & the Institute of Internal auditors. (Source: CIFL PLC Annual Report 2011/2012) Responsibilities of the Board…show more content…
The main function of this committee was to review & determine staff remuneration. When deciding remuneration, performance appraisals, industry averages & capacity of CIFL were considered. Remuneration so decided enabled sufficiency to attract & retain suitably qualified people within the organization. The remuneration determined by this Committee was then ratified by the Board. (Source: CIFL PLC Annual Report 2011/2012) Collapse of CIFL Two years since the IPO of CIFL, commenced the dire liquidity crisis indicating following symptoms of the collapse. Symptoms of the Collapse: • Delay of depositors' payback of payments • Depositors of CIFL receiving a message in July 2013, depositors of CIFL that “The People's Leasing Finance PLC is still supervising the day to day functions of the company & a Monetary Board meeting will be held after People's Leasing submits the report on CIFL. Regret that still no definite update with regard to your payment. However there will be an update soon from the Central Bank.” • Receipts of Rs. 3.5 billion in deposits but just millions in assets & even less amount in the bank accounts indicating of a huge mismatch. • Mismanagement of funds over an extended period of time as deposits were accepted & invested in projects such as housing & real estate, which did not turn out to be

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