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Udupussellawa & Hapugastenne Plantations Appoint New Members to Board

Udupussellawa Plantations PLC and Hapugastenne Plantations PLC, which are operated under Browns Plantations, have appointed four new Non-Executive Directors to its boards effective March 30, 2022; Dr. Pradeep Uluwaduge, Mr Kamantha Amarasekara, Ms Sunjeevani Kotakadeniya and Mr T. Dharmarajah.

Mr Anusha Suhanda Perera, who currently serves on the boards of the aforementioned companies as an Independent Non-Executive Director, has been appointed Executive Director of both plantations. Dr. Pradeep Uluwaduge took over as Chairman of both Udupussellawa Plantations PLC and Hapugastenne Plantations PLC as the successor of Mr Anusha Suhanda Perera. Mr G.D.V. Perera who is a veteran planter and the former Chairman of the Planters’ Association has also joined Browns Plantations as a Senior Consultant effective April 01, 2022.

With the acquisition of Udupussellawa and Hapugastenne plantations, Browns Plantations has grown to be recognised as one of the largest plantation companies in Sri Lanka. Browns Plantations prides itself in being a key supplier to the Colombo Tea Auction, which is the oldest uninterrupted one in the world. The Company with its emphasis on exceptional quality has set new standards in offering ‘a good cup of tea.’ For over 150 years, the tea industry led by resilient planters, spearheaded Sri Lanka's economy and continues to play a significant role in the country's development, and Browns Plantations is delighted to be a part of this journey of national importance.

From January to December 2021, Browns Plantations has produced and sold over 12,321,994kg of tea as the largest tea producer in Sri Lanka with a total market share of 15% among the Regional Plantation Companies (RPC), which makes us the number one producer of Ceylon tea in Sri Lanka.

Commenting on the appointments, Dr. Pradeep Uluwaduge stated, “LOLC Group ventured into the plantation sector a decade ago as a result of its business diversification strategy. We recently acquired Udupussellawa Plantations PLC and Hapugastenne Plantations PLC, which were under the wing of Finlays. We are optimistic about the enormous potential of these estates and will focus on the merits of the industry, which sustained the country for decades and will continue to support the economy in the future. We are certain that we can turn these two plantations around to be the most profitable plantation business in the country while ensuring sustainability at every stage of our operations.”

Udupussellawa Plantations owns 11 thriving estates, including Alnwick, Blairlomond, Delmar, Gordon, Waldemar, Concordia, Court Lodge, Park, Duckwari, Madulkelle, and Yatawatte. While Udupussellawa Plantations is more focused on growing exceptional quality Ceylon Tea, the portfolio boasts a wide range of crops such as Rubber, Coconut, Coffee, Cocoa, Pepper, and Cardamom. 19 Reputed estates come under Hapugastenne Plantations; Alupola, Galabode, Hapugastenne Tea, Hapugastenne Rubber, Depedene, Hatherliegh, Madampe, Springwood, Adawatte, Dammeria A, Dammeria B, Hopton, Shawlands, Bibile, Demodera, Nahaville, Oodoowerre, Rookatenne, and Newburgh. Furthermore, the portfolio of Hapugastenne Plantations includes Tea, Rubber, Timber and other commercial crops. Hapugastenne and Udupussellawa Plantations comprise of 30 tea farms and 20 processing centres which sit within six of the seven agro-climatic regions of Sri Lanka.

Browns Plantations, which falls under Browns Investments PLC, owns and manages Maturata Plantations PLC as well. Maturata Plantations comprises of 11 Tea estates in the Nuwara Eliya District and another 08 estates in the Matara District with Tea, Cinnamon and Rubber.

Browns Investments is a subsidiary of Brown & Company PLC, under which all Non-Financial sectors of the Group are clustered.


Club Hotel Dolphin Reopens its Doors After Rs.300 Million Upgrade




Club Hotel Dolphin Reopens its Doors After Rs.300 Million Upgrade

A ribbon cutting ceremony was held marking the official reopening of Club Hotel Dolphin to the public and heralding a new age in post-pandemic travel. Kapila Jayawardena, Group Managing Director/CEO of LOLC Holdings PLC & Chairman of Serendib Hotels PLC; Eksath Wijeratne, Group General Manager of Browns Hotels & Resorts; Adrian Jansz, General Manager-Sales and Marketing of Browns Hotels & Resorts, and Suresh Athukorala, General Manager of Club Hotel Dolphin were among the distinguished attendees.

Set along the western coastline of Waikkal, the renovated Club Hotel Dolphin is fully geared to welcome travellers from around the world. Fronted by an investment of over Rs.300 million by Browns Hotels & Resorts, a subsidiary of Browns Investments PLC; a full renovation was carried out to meet the present day traveller’s needs.

Club Hotel Dolphin is the ideal location for tourists to both begin and end their beach holiday in Sri Lanka, being close proximity to the Bandaranaike international airport. The hotel features 154 guest rooms with ultra-modern amenities, 2 swimming pools, 4 bars, 2 restaurants, 2 cafes, a conferencing venue, spa fitted with a sauna and steam room, fully-fledged gymnasium and a kids’ club. The hotel also hosts a range of indoor and outdoor activities including badminton, tennis, beach volleyball, archery, squash, pool, billiards, chess, darts, table tennis, carom and a variety of board games to ensure everyone has a fun-filled time. Guests truly are spoilt for choice, with an all-encompassing range of delightful guest amenities and activities, making it the perfect location for anyone looking for a vibrant all-inclusive getaway.

Serving the freshest catch of the day, the talented chefs whip up dishes using locally sourced ingredients that will leave guests craving for more. The open kitchens at both restaurants allow guests to watch the club chefs work their magic, simply elevating the overall dining experience.

“Admiral Court”, the conferencing venue coupled with an energetic animation team, and all other in- house facilities make Club Hotel Dolphin the preferred choice for corporates; to facilitate meetings, incentives, conferences and exhibitions.

Eksath Wijeratne, Group General Manager of Browns Hotels & Resorts commented, “Club Hotel Dolphin stands out as we offer a substantial range of exciting activities for travellers of all ages. We are certain that the hotel would be the number one choice for families and large groups of friends looking for a fun filled holiday in the tropics.”

LOLC Group’s investments in the leisure sector are clustered under Browns Investments, which maintains controlling interest in a number of properties in iconic locations in the country. The portfolio currently consists of Avani Bentota Resort, Club Hotel Dolphin, Dickwella Resort & Spa, Hotel Sigiriya, The Calm Resort & Spa, 05 boutique properties under Reveal The Collection, Sheraton Kosgoda Turtle Beach Resort, Occidental Paradise Dambulla and Occidental Eden Beruwala. A further 2 projects; including a 5-star resort in Beruwala, and Port City Mega Leisure development comprising of a 5-star city hotel are scheduled to be unveiled in the near future. A series of offshore investments in the Maldives including 4 resorts and 1 city hotel/condominium, and a 5-star resort in Mauritius too has been added to the development pipeline.

Browns Hotels & Resorts unwavering efforts in uplifting tourism even during the toughest of times, makes it one of the most sought-after hospitality brands in the region, and is a testament to the optimistic outlook the Company has on post-pandemic travel, as they prepare to welcome travellers from around the globe.

Club Hotel Dolphin Reopens its Doors After Rs.300 Million Upgrade


Club Hotel Dolphin Reopens its Doors After Rs.300 Million Upgrade






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Avani Bentota Resort reopens its doors to the world

23rd of March 2022 - A ribbon cutting ceremony was held marking the official reopening of Avani Bentota Resort to the public and beckoning a new age in post-pandemic travel. It was attended by Kapila Jayawardena, Group Manager Director/ CEO of LOLC Holdings PLC & Chairman of Serendib Hotels PLC; Eksath Wijeratne, Group General Manager of Browns Hotels & Resorts; Adrian Jansz, General Manager-Sales and Marketing at Browns Hotels and Resorts and Channa Ekanayake, General Manager, Avani Bentota Resort.

Set along Sri Lanka’s western coastline, the renovated Avani Bentota Resort is now fully geared to welcome travellers from around the world. Fronted by an investment of Rs.300 million by Browns Hotels & Resorts, a subsidiary of Browns Investments PLC; a full renovation was carried out to meet the present day traveller’s needs.

Originally designed by world renowned architect Geoffrey Bawa, the revamped resort features 75 chic guest rooms and suites, 03 dining outlets, a gymnasium, spa, as well as 02 conferencing and event venues, in addition to the modernised guest support service area and kitchen, in the hopes of providing guests with a more superior and efficient service. While the recently renovated resort boasts of a contemporary and sophisticated design, it retains Bawa’s signature style and an inimitable Dutch-colonial charm.

Guests are sure to be spoilt for choice with one of the most extravagant breakfast buffets in the west coast, which also includes Sri Lankan specialties. For a more intimate setting, guests can indulge in exquisite dining experiences right on the beach with carefully curated menus, simply sip sundowners by the pool, or order in. Culinary adventures enhanced with dreamy ocean views are assured at Avani Bentota Resort.

LOLC Group’s investments in the leisure sector are clustered under Browns Investments, which maintains controlling interest in a number of properties in iconic locations in the country. The portfolio currently consists of Avani Bentota Resort, Club Hotel Dolphin, Dickwella Resort & Spa, Hotel Sigiriya, The Calm Resort & Spa, 5 boutique properties under Reveal The Collection, Sheraton Kosgoda Turtle Beach Resort, Occidental Paradise Dambulla and Occidental Eden Beruwala. A further 2 projects; including a 5-star resort in Beruwala, and Port City Mega Leisure development comprising of a 5-star city hotel are scheduled to be unveiled in the near future. A series of offshore investments in the Maldives including 4 resorts and 1 city hotel/condominium, and a 5-star resort in Mauritius too has been added to the development pipeline.

Commenting on the recent acquisitions, Kapila Jayawardena said, “With a steadfast approach to innovation and bold strategies, Browns Investments will continue to invest in the leisure and hospitality sector both in Sri Lanka and overseas, as we believe that there will be an upsurge in travel globally.”


Eksath Wijeratne added, “While the Covid-19 pandemic has disrupted the hospitality industry worldwide, the global vaccination drives have been instrumental in regenerating and boosting tourist arrivals in to the country. Most tourists currently gravitate towards the informal sector. Nevertheless, we are hopeful that a steady increase in the overall tourist arrivals to the country will result in positive occupancy levels across both formal and informal sectors by end 2022.”

The unwavering efforts of Browns Hotels & Resorts in uplifting tourism even during the toughest of times, make it one of the most sought-after hospitality brands in the region, and is a testament to the optimistic outlook the Company has on post-pandemic travel, as they prepare to welcome travellers from around the globe.

Avani Bentota Resort reopens its doors to the world
Pictured left to right; Channa Ekanayake, General Manager Avani Bentota; Kapila Jayawardena, Group Manager Director/ CEO of LOLC Holdings PLC & Chairman of Serendib Hotels PLC; Adrian Jansz, General Manager-Sales and Marketing at Browns Hotels and Resorts and Eksath Wijeratne, Group General Manager of Browns Hotels & Resorts.

Avani Bentota Resort reopens its doors to the world


Avani Bentota Resort reopens its doors to the world



Browns Investments PLC acquires Udapusselawa Plantations PLC and Hapugastenne Plantations PLC




Browns Investments PLC yesterday announced the acquisition of shares worth 90% in Udapusselawa Plantations PLC and Hapugastenne Plantations PLC for Rs. 1.9 billion from Finlays Sri Lanka, who were present in the country for 128 years.

The deal is at Rs. 42 per Udapusselawa (UDPL) share and Rs. 28.30 per Hapugastenne (HAPU) share. Price paid for UDPL is 81% premium to the Net Asset Value of Rs. 23.17; and for HAPU, it was 154% premium to NAV of Rs. 11.13. The transaction will be executed shortly. The sale will mark the exit of the 1893-established Finlays from the plantation business though it will continue with other businesses.

Post-announcement, Udapussellawa Plantations share price gained by 25% or Rs. 6.70 to close at Rs. 33.60, whilst Hapugastenne Plantations also rose by 25% or Rs. 4.30 to close at Rs. 21.70. Strangely, the two counters more-or-less saw trading of 66,000 shares each. Browns Investments’ share gained by only 2% or 30 cents to Rs. 14.30. The share price of Brown & Company recorded a gain of Rs. 13.25 (3.90%) to close at Rs. 353.25.

BIL is to make a mandatory offer to buy the remaining stake in both companies. Udapusselawa's public float is 10%, held by 12,121 shareholders; and Hapugastenne's public float is 10%, held by 21,393 shareholders.

High net worth investor Imtiaz Buhardeen said the deal is likely to re-rate the plantation sector stocks and trade at higher prices.

UPL and HPL comprises of 30 tea farms and 20 processing centres which sit within six of the seven agro- climatic regions of Sri Lanka.

In a statement, Finlays said there will be no immediate change for any of the employees of either plantation company, and Browns intends to continue to run the business as it has been operated until now.

“Finlays will continue to be represented in Sri Lanka by Finlays Colombo Ltd., its tea blending and packing operation, which sources teas from multiple origins, including Hapugastenne and Udapussellawa via the Colombo auction. This means that Finlays is able to continue to provide an uninterrupted service to customers,” the statement said.

Finlays Group Managing Director Guy Chambers said: “After careful consideration and a rigorous selection process, we have agreed to transfer ownership of our Sri Lankan Tea Estates to Browns Investments PLC.”

“As a Sri Lanka-based investment firm with a strong track record in agriculture, Browns Investments PLC is ideally placed to unlock the long-term value of Hapugastenne Plantations PLC and Udapussellawa Plantations PLC. These Sri Lankan farms have played an important role in Finlays’ history, and we are sure that they will continue to flourish under the ownership of Browns Investments PLC. I would like to thank our tea farm colleagues in Sri Lanka for their passion and commitment, and wish them well for the future,” Chambers added.

BIL Director Kamantha Amarasekera said: “Hapugastenne Plantations and Udapussellawa Plantations are two of the best managed and productive plantation companies in Sri Lanka, and we are proud to be associated in their future journey. We will work with Finlays to ensure a smooth transition between the two groups. We warmly welcome the management and staff of Hapugastenne Plantations and Udapussellawa Plantations to the Browns family, which has a business heritage dating back to 1875.” BIL also owns Maturata Plantations Ltd., which manages 19 estates spread across 11,595 acres mainly with tea and a total forestry extent of 1,600 hectares has 1,195 hectares of commercial timber, 380
hectares of fuelwood and also 405 hectares of cinnamon. BIL is also engaged in fertiliser, crop care and seeds business via AgStar PLC. Separately, BIL’s related parties Brown and Company and LOLC own a 49% stake in Galoya Plantations Ltd., producing sugar.

With a history spanning over 125 years in Sri Lanka, Finlays has 7,285 hectares of tea farms and grows over 10 million kilos of tea annually via the two listed companies, of which around 7 million kilos are exported to customers in over 30 countries. It has 20 tea processing factories in its farms producing, black, green and oolong teas and a modern packing plant.

Finlays Sri Lanka is part of Swire Group, a highly diversified global business group. Global firm Finlays was founded in 1750 and is a leading independent B2B manufacturer and supplier of tea, coffee and botanical solutions to beverage brand owners worldwide. Apart from Sri Lanka, Finlays has tea plantations in Kenya, Argentina and China with a combined hectarage of 27,000.



B Investments invests $ 114 m in Port City




Browns Investments PLC (BIL) on Friday revealed that it had already invested $ 114 million, or Rs. 23.2 billion, so far for multiple projects in the Port City with commitment for a further $ 86 million in the next two years.

The payment through BIL's subsidiaries is after securing a 99-year leasehold rights of identified plots (over 74,400 square metres) at the Port City by entering into Indentures of leases on 2 December with the Colombo Port Economic Commission.

The amounts already paid for leases and respective projects include $ 42 million for Colombo International Financial Centre via BIL's subsidiary Ceylon Real Estate Holdings Ltd. The amount paid is part of the $ 102 million total lease cost for the 30,630 square metres of land for the project.

BIL, which is the LOLC Group's strategic investment arm, has via subsidiary Colombo Marina development Ltd. fully paid $ 55 million for 30,776 square metres of land for the Colombo Marina Development.

Additionally, via subsidiary Marina Hotel Holdings Ltd. $ 17 million was paid initially for the Port City Marina Hotel Development on a 12,006 square metre land plot. Total commitment is $ 43 million.

BIL said the balance $ 60 million for the Colombo International Financial Centre would be paid within a year and the $ 26 million payable on Port City Marina Hotel Development would be in two instalments in 2022 and 2023.

Friday's disclosure was a follow up to its original announcement in December last year revealing the MoU signed with China Harbour Engineering Company Ltd. (CHEC) to start the Colombo International Finance Centre (CIFC) Mixed Development project.

The project will be piloted over two phases whereby BIL is partnering with CHEC for Phase One via the incorporation of a Special Purpose Vehicle company. In the December 2020 disclosure, BIL said the total investment in Phase One amounts to $ 450 million with a buildable land area spanning 3.06 hectares which is leased from CHECH Port City Colombo Ltd. to the new SPV that will be jointly owned and managed by BIL and CHEC.

“This will be a significant undertaking involving the construction of one residential apartment tower, one serviced apartment tower, one office tower and a retail podium on the ground floor,” the original announcement said.

The mega announcement with progress of money paid and committed however didn’t boost BIL share price on Friday as it closed 10 cents higher at Rs. 14.50 (in September last year it closed at Rs. 2.70).

Nevertheless, BIL has been the most actively traded stock on the Colombo Stock Exchange (CSE) whilst its public float is 16.7% or 2.4 billion shares. Brown and Company and related parties control over 80% stake. LOLC Holdings share price closed down Rs. 5.50, or 0.56%, to Rs. 974.75, but Brown and Company closed up Rs. 3.50, or 1.26%, to Rs. 281.



BROWNS HOTELS & RESORTS AWARDED TRIPADVISOR TRAVELER’S CHOICE 2021

Reinforcing its commitment in providing an exceptional holiday experience for guests, Browns Hotels & Resorts once again was awarded the TripAdvisor Traveler’s Choice for the year 2021.

The prestigious award was bestowed to all properties under the Browns Hotels & Resorts portfolio inclusive of Calm Resort & Spa, Dickwella Resort & Spa, Club Hotel Dolphin, Hotel Sigiriya, Avani Bentota Resort and also the villa collection, Reveal, including Lantern Boutique Hotel, Ubuntu Beach Villas, The Beach House, Stafford Bungalow and Tri.

TripAdvisor is the world’s largest travel platform, which connects travelers across the globe to genuine reviews and opinions. Independent guest reviews are submitted based on a criterion, which includes location, service, facilities etc. making it the most reliable and notable travel platform in the world.

Commenting on the award received, Group General Manager Eksath Wijerathne said, “We are honoured to receive the coveted TripAdvsior Traveler’s Choice once again for our collection of hotels & villas. This is a true testament of our team’s commitment and dedication in providing an outstanding service to our valued guests. We are humbled by this recognition given for our efforts especially whilst conquering a trying year due to Covid-19. We will continue to uphold our promise of service par excellence across our unique properties as we look forward to welcoming our guests back.”

Browns Hotels & Resorts’ fast-growing portfolio includes distinctive properties spanning across key tourist destinations in the island. As a trustworthy hospitality brand, Browns stays true to its service ethos by providing a personalized and plush holiday experience to guests.

The Calm Resort & Spa in Passikudah is set along one of the world’s longest stretches of shallow coastline allowing guests to wade out in pure serenity, take part in exciting water sports or explore the wonders of the East Coast.

Dickwella Resort & Spa is located a few minutes away from the world-renowned surfing destination, Hiriketiya and is the perfect family holiday destination offering a variety of recreational & dining facilities for a memorable getaway.

Hotel Sigiriya offers an experience of embarking on a journey of discovery through the heart of Sri Lanka's Cultural Triangle. The eco-retreat is set amidst lush greenery and boasts the best view of the iconic Sigiriya Rock.

Club Hotel Dolphin is your ideal fun-filled family holiday destination with a myriad of activities and adventure all packed together. With two pools – one being the longest in the country, a brilliant gymnasium, indoor & outdoor games, bars and restaurants, guests here are spoilt for choice.

Avani Bentota Resort is a designer hotel nestled along the golden beach stretches of Bentota. Designed by renowned architecture, Geoffrey Bawa, this contemporary property promises a rejuvenating beach holiday.

Reveal, The Collection is a compilation of boutique villas offering luxurious holiday spaces around the island. Set along the glistening beach stretches of Mirissa are three properties; Lantern Boutique Hotel - an oceanfront villa with open spaces inviting a tropical lifestyle, Ubuntu Beach Villas, two-standalone contemporary villas comprising of sixteen rooms seamlessly blending tropical comforts with natural elegance, and The Beach House - a stylish beachfront getaway with six tastefully designed rooms.

Located in view of the scenic Koggala Lake, Tri is a contemporary, sustainable and luxurious boutique hotel sheltered amidst natural beauty. Moving into the chilly hill caps in Nuwara Eliya, Stafford Bungalow is a 130-year old refurbished planter’s bungalow set amidst a working tea plantation in Ragala, designed with an old-world charm.

Browns Hotels & Resorts is a subsidiary of the Browns Group, one of Sri Lanka’s largest diversified conglomerates, which manages a fast growing and valuable portfolio of brands across several key industry sectors, such as power generation; home and office solutions; agriculture and plantation support services; pharmaceuticals; investments; marine and manufacturing; and healthcare.



LOLC Group achieves first-ever historic profitability in Sri Lanka’s corporate sector, recording a stunning Rs. 57 Bn in PBT




Sri Lanka’s most valuable and globally diversified financial conglomerate, the LOLC Group, posted a record-breaking performance for the financial year ending 31st March 2021, achieving unprecedented bottom line results of Rs. 57Bn in Profit Before Tax (PBT), and a Profit After Tax (PAT) of Rs. 53Bn - a first for any corporate in the country. By achieving profits on this massive scale in the history of Sri Lanka’s corporate world, the Group once again consolidated its position as the top most profitable diversified corporate in the country, three years in a row - establishing LOLC as one of the largest Micro and Small Medium Enterprises (MSME) platforms in the world.

This stunning performance by LOLC resulted in a Rs. 28Bn being recorded as Profits Attributable to the Equity Holders of the Parent company. The Group results denote an impressive Earnings Per Share of Rs. 59.01 compared with Rs. 22.93 recorded in the previous year. Whereas, the total comprehensive income was Rs. 81Bn out of which Rs. 37Bn is attributable to the Equity Holders of the Parent company. Furthermore, the total attributable comprehensive income per share was Rs. 77.84. The resultant Net Assets Value per Share as at the year-end was Rs. 286.23 compared to Rs. 194.72 reported last year, demonstrates the exceptional value creation by the Group during the concluded financial year.

The story of LOLC’s rise into an elite blue-chip within a span of 40 years is nothing short of awe-inspiring, surpassing competitors who have been in existence for over a century. A pioneering leasing company established in the year 1980, in collaboration with ORIX Corporation of Japan and International Finance Corporation (IFC), LOLC, revolutionized the future of MSMEs in Sri Lanka and rose in stature as Sri Lanka’s largest Non-Banking Financial Institution (NBFI). Having established a high performance microfinance business model, LOLC rapidly exported its expertise to global markets such as Cambodia, Myanmar, Indonesia, Philippines, and Pakistan in Asia; as well as Zambia and Nigeria in East and West Africa, bringing prosperity to people at the bottom of the pyramid. In addition, the Group has established its footprint in the Maldives and Sierra Leone in the arena of Non-Financial Services.

In Sri Lanka, the LOLC Group diversified into agriculture and plantations, leisure, renewable energy, construction, manufacturing and trading, information services, as well as research and innovation over and above its flagship financial services. All of these businesses recorded an upward trend in profitability in 2020/21, despite the adverse effects of COVID-19 being felt by Sri Lanka’s economy through 2020, coupled with weak GDP growth in the preceding year. Despite the global economic downturn experienced during the period, a strong pipeline of multilateral and bilateral funding has been available to LOLC and its operating companies both locally and globally - a testimonial to the confidence these institutions have placed in the LOLC Group due to its strong and unblemished track record and the potential for growth even during turbulent times.

Performance of Financial Services Companies

LOLC’s financial services have brought about life-changing financial inclusion in MSMEs in Sri Lanka, empowering frequently marginalized communities to build a better future for their families - driving women’s empowerment and financial independence by encouraging their entrepreneurial ambitions. Overall, the LOLC Group’s Financial Services achieved a Rs. 17.3Bn as bottom line despite allowing for a strong level of risk mitigating provisions amounting to Rs. 30Bn for bad and doubtful debts on a very conservative basis against Rs. 17Bn last year. Livelihoods of people in all sectors have been badly affected by the COVID 19 pandemic and at the request of the regulators of each country, the Group’s Financial Services Companies have extended moratoriums to affected customers - extending a safety-net to those in need.

LOLC’s finance companies in Sri Lanka experienced a strong level of deposit inflows despite the all-time low interest rates. The flagship finance company - LOLC Finance PLC (LOFC) – with a Total Assets base of Rs. 170Bn, recorded PAT of Rs. 4.4Bn. Commercial Leasing & Finance PLC (CLC) with a Total Assets Base of Rs. 77Bn also recorded strong performance, posting a PAT of Rs. 2.2Bn in 2020/21. Meanwhile, with a Total Assets Base of Rs. 19Bn, LOLC Development Finance (LODF) PLC recorded a PAT of Rs. 155Mn.

Seylan Bank succeeded in delivering a steady PAT of Rs. 3Bn for FY2020. Deposits increased by 9.9% and advances increased by 4%, whereas the CASA Ratio stood at 33%.

LOLC’s global success took seed in 2007, when it invested in PRASAC - a Cambodian microfinance organisation - and grew it into a billion-dollar organization in less than 12 years. A 70% stake was recently acquired by the Republic of Korea’s largest commercial bank, Kookmin Bank, for US$ 603 Mn - thereby contributing to overall Group profitability and strengthening its balance sheet with a put option to divest the remaining stake in December 2021.

LOLC’s overseas financial services entities made strong contributions to the profitability of the Group in 2020/21 - with LOLC Cambodia leading the way with a US$ 45 Mn in PAT with the Total Assets base exceeding over US$ 1 Bn. In Cambodia, LOLC continues to hold a 97% stake in LOLC Cambodia - the fourth-largest microfinance company in terms of market position, and the second most profitable microfinance institution in Cambodia after PRASAC.

Venturing into Myanmar in 2013 as a greenfield operation, LOLC Myanmar Microfinance Company Limited has now become the fourth-largest among the 176 MFIs, with an asset base of US$ 175 Mn, a portfolio of US$ 126 Mn and a growing deposit book of US$ 20 Mn. LOLC Myanmar has seen exceptional performance in FY2020/21 by posting a profit of US$ 3 Mn as PAT, and envisages strong growth prospects amidst the atmosphere of a large unbanked population.

In 2017, LOLC ventured into Pakistan by investing in Pak Oman Microfinance Bank (POMB), a joint venture with the Islamic republic of Pakistan and the Sultanate of Oman, which is now poised for rapid growth in a country with a population of over 200 million - offering attractive industry fundamentals. POMB operates through 66 branches, extending its services to over 50,000 clients. The Group ventured into Indonesia in 2018, acquiring the controlling interest in PT Sarana Sumut Ventura (SSV), further expanding its global footprint. SSV is now well-positioned to capture the industry potential in a country with a population of 270 million with over a 100 million bottom of the pyramid population. SSV operates through 28 branches, extending its services to over 60,000 clients.

Tapping into other neighbouring emerging markets, LOLC invested in the Philippines - a country with a population of 110 million - through LOLC ASKI Finance and LOLC Bank Philippines - a thrift bank in 2019. LOLC ASKI operates through 15 branches, extending its services to over 3,000 clients, while LOLC Bank operates through 10 branches, extending its services to over 8,000 clients.

In the year under review, the Group made its first finance sector investment in the African region by acquiring a controlling stake of FinaTrust Microfinance Bank in Nigeria – a west African nation with the largest population in the continent of 206 million. FinaTrust will provide support to MSME entrepreneurs for significant financial inclusion in the country - operating through 8 branches and extending its services to over 3,000 clients. The Group commenced operations in Zambia by incorporating LOLC Finance Zambia as a greenfield operation - which currently operates through 6 branches.

The global expansion strategy for the financial services sector remains a key focus, with plans being made for expanding into more markets in both Africa and Asia.

LOLC’s two insurance companies: LOLC General Insurance Ltd. and LOLC Life Assurance Ltd. demonstrated strong resilience against the unprecedented impacts of the pandemic and other socio-economic adversities. LOLC Life Assurance registered a GWP of Rs 3.2 Bn - the first Life Company in the industry to achieve this milestone in less than 10 years - and posted a growth of 21% in GWP, backed by a robust growth of 59% in first year premiums: the highest new business growth in the insurance industry. Meanwhile, LOLC General Insurance achieved Rs. 6Bn in Gross Written Premium in 2020 in less than 10 years - a first for Sri Lanka.

After success in the overseas MSME sector, the company is leveraging on its vast international customer base and technical synergies to enter the micro insurance arena, already securing licenses in Cambodia and a representative office in Myanmar - thereby offering end-to-end financial security for the MSME sectors in these markets. One of the key factors for LOLC’s success in overseas sectors will be that it is penetrating markets with large populations, in order to serve the MSME segments in those countries and help them scale up the value chain.

LOLC Securities (LOSEC) Private Limited, a leading stock broker with strong retail and local and foreign institutional client base, expanded its market share from 7% to 9.5% in FY 2020/21. The company is ranked 2nd among peers in terms of Total Market Turnover during the year under review. Improved brokerage earnings, ongoing expense management policies, and positive stock market sentiment helped the company to record impressive performance.

LOLC’s expertise in financial services has been further underscored by the launch of iPay, a unique payment aggregator which has garnered close to 90,000 subscribers and enables a wide range of financial transactions through the app. It has been successfully launched in Sri Lanka and Cambodia, along with implementation plans already in place for Myanmar, Pakistan and Indonesia. iPay became the market leader in Sri Lanka in terms of customer acquisition and transaction volumes on its launch. As a tech-savvy global player, LOLC is continuously investing in technology and technology-enabled services, bringing in technology to its business to automate processes - thereby becoming a predominantly ‘phygital’ financial service provider. LOLC has standardized its local and global operations on an Oracle based common core banking platform built by LOLC Technologies named Fusion X for greater operational efficiencies.

Performance of Non-Financial Sector Companies

Brown & Company PLC with a history of 146 years, together with its investments arm, Browns Investments PLC (BI), under which LOLC’s non-financial services businesses are structured, recorded resilient performance during the year under review. Despite the challenges encountered in the macroeconomic environment and in the intensity of the competitive landscape, Browns’ trading business recorded one of its highest revenues with an increase of 45% with a gross profits increase of 47% for the FY 2020/21, while posting a PAT of Rs. 1.8Bn

Browns and BI, has energized many vital sectors of the Sri Lankan economy, including trading and manufacturing, precision engineering, mechanization of agriculture, automotive, power storage, renewable energy, leisure & hospitality, plantations, construction, marine and veterinary pharmaceuticals.

Browns is the most trusted, reliable and preferred partner for many leading global brands, introduced the world-renowned Massey Ferguson tractors back in 1952, becoming the first distributor in the whole of South and South East Asia. Further, the company harnessed its superior enterprise capabilities to make TAFE the highest selling tractor brand in Sri Lanka. Today, TAFE and Massey Ferguson enjoys a 50% market share. Yanmar Combined Harvester, the most preferred brand in the Japanese segment holds over 60% market share while SUMO, its Chinese counterpart, holds over 50% market share in that particular segment.

The Auto Power Market, with its distinctive competitiveness in technology, innovation, is well ahead of its competition with a 75% market share combined with the superior Exide, Lucas and Dagenite range. Further, RADCO, the number one brand of radiators in Sri Lanka is the market leader holding over 50% market share.

Browns also partners with leading global veterinary brands such as Zagro, MSD and Eukanuba.

In collaboration with the world’s leading brands, the company provides an unmatched range of heavy machinery – Hitachi and Sakai, and tools – Makita and Tailin, reputed for trusted technology, advance functionality and energy efficiency. In the Electric Energy Solutions, Browns has a partnership with F G Wilson. The success of FG Wilson in Sri Lanka demonstrates the technical marketing proficiency of the company. It also markets Yanmar & Hyundai and PARSUN, the world’s most reliable and durable Marine engines.

The Group’s local plantations sector operates through Maturata Plantations and Gal Oya plantations, two businesses that recorded strong performance in the year under review.

Maturata’s business focus lies in the management of the company’s tea plantations profitably while the future strategies are aligned to create long term value from cinnamon, with the company having the largest cinnamon plantation in the country. The BI Group acquired a 67% stake in Tropical Island Commodities Pvt Ltd., a cinnamon exporter in the country with a focus of developing value-added cinnamon products to attract global markets with strong demand for Sri Lankan cinnamon. During the year, Maturata recorded a historic performance with an excellent profit contribution to the Group, a PAT of Rs. 382Mn.

Gal Oya Plantations continued to enhance its sugar cane growing and production capacity with Hingurana Sugar Factory being expanded to meet local demand, which will also help the Government to reduce expenditure on sugar imports. Gal Oya also produces the highest grade ethanol in Sri Lanka.

BI Group, invested in Sunbird Bioenergy (SBSL) Limited in 2019, an agro-based company incorporated in Sierra Leone, the largest land extent allocated for sugar cane plantation in the region with 23,791Ha with the ability to increase up to 50,000Ha, produces Extra Neutral Alcohol (ENA) as per the global industrial standards. The company achieved its plantation target of increasing the sugar cane extent up to 6,500Ha from 900Ha in 2019, a remarkable achievement for the Group and produced an ENA of 14.3Mn liters. SBSL also generates and exports power to the national grid with a power generation capacity of 32MWh.

In the renewable energy sector, Sagasolar Power (Pvt) Limited, the first utility scale solar plant in the country, has been in operation for over 4 years since its commissioning in 2016 and generates steady profit contributions to the BI Group.

Browns Engineering, the Construction and Engineering arm of BI, aims to improve its market share in the telecommunication industry in Sri Lanka to be the turnkey solutions provider for telco operators. The company has performed extremely well with Rs. 1.6 Bn revenue along with Rs. 361 Mn in PAT. Further, Browns Engineering plans to expand its operations in infrastructure development projects in roads and bridges, water and sewerage, and electrical and piling work in Sri Lanka and the Maldives.

Complementing the construction business of BI, Ajax Engineers (Pvt) Ltd., (Ajax), with its strong track record in the aluminium fabricating business, became the No. 1 player in the Aluminium façade industry in Sri Lanka with large development projects being awarded to the company for end-to-end aluminium solutions. Gurind Accor Private Limited, the renowned Glass Processing company with the brand Gurind Tough is the no. 1 local glass processor, the pioneer toughened glass supplier in the country holding a dominant market share together with General Accessories & Coating Pvt Ltd. recording strong financial performance despite COVID-19 challenges directly impacting the country’s construction industry. Creation Wooden Fabricators (Pvt) Ltd, engaged in custom build furniture solutions too reported commendable financial performance during the year.

Excel World is being upgraded to become the premier food & beverage and MICE destination in Colombo City. Meanwhile, Excel Restaurants Pvt Ltd. was granted franchise rights of 7 leading restaurant brands in Colombo.

Browns Hotels & Resorts, a subsidiary of BI continued to enjoy a strong presence in the leisure sector with Eden Resort & Spa in Beruwala with 158 keys, The Paradise in Dambulla with 67 keys, Dickwella Resort & Spa with 76 keys and The Calm Resort & Spa in Pasikudah with 70 keys. With the assistance of Sri Lanka Tourism Development Authority (SLTDA), the government has formulated short-term and long-term plans to rebuild the tourism industry impacted by the pandemic. The Group’s timely conversion of these properties into repatriation hotels helped the operating hotels to enjoy a steady stream of revenues generating operating profits. Sheraton Kosgoda Turtle Beach Hotel with 172 keys, a five-star property managed by Sheraton was commissioned during the year. The Group recommenced the construction activities of Riverina Resorts Beruwala, another 365 key five-star property.

Anticipating strong growth in the leisure business in the medium to long term, BI leisure subsidiary, Eden Hotels Lanka PLC acquired the controlling stake of Serendib Hotels PLC. This acquisition adds the Dolphin Hotel in Waikkal with 154 keys, Avani Bentota with 75 keys, Hotel Sigiriya with 79 keys, and the Reveal Collection of Villa properties under Frontier Capital Pvt Ltd with 28 keys into the Group’s leisure footprint. Dolphin Hotel, Avani Bentota and Hotel Sigiriya are currently operating as Quarantine properties.

The Group’s leisure footprint expanded to the global arena with a significant investment in Maldives in the last few years. Nasandhura Maldives, a luxury city hotel with 136 rooms, 118 apartments and a sophisticated retail mall, is nearing completion. This is a flagship property and will be an iconic development in the Male city. Another project in progress on the island of Bodhufarufinolhu with 100 keys, in the Ari Atoll, Maldives is to be completed in December.

Having grown its leisure footprint significantly and with the expansion planned for the medium term, the Group will hold 2,000 plus keys in Sri Lanka and overseas leisure properties to be positioned as a significant leisure operator.

Browns Investments PLC entered into a landmark agreement to partner with China Harbour Engineering Company Limited (CHEC) to commence the Colombo International Finance Centre (CIFC) Mixed Development Project, which has strategic development project status, in Colombo Port City (CPC). This project comprises of a land area under development of 6.8 Hectares with an investment value totaling US$ 1 Bn. The total investment in Phase One amounts to US$ 450 Mn with a buildable land area spanning 3.06 hectares, which is leased from CHEC Port City Colombo (Private) Limited to the new SPV that will be jointly managed by Browns and CHEC. This will be a significant undertaking involving the construction of two residential apartment towers, one serviced apartment tower, one office tower and a retail podium on the ground floor.

The LOLC Group is also exploring Technology and Innovation aligned to His Excellency the President of Sri Lanka’s vision and to infuse local value addition. LOLC Advanced Technologies has built capacity to convert graphite to graphene and in partnership with SLINTEC, in which it has invested, is also conducting value additions such as fortifying rice with nutraceuticals; and researching organic fertilisers to cater to the current demand. LOLC’s thirst for new knowledge and scientific innovation remains insatiable. More importantly, the Group provides opportunities for local scientists to work on exciting projects and encourages a spirit of discovery and innovation not abundantly available in Sri Lanka.

Recording the highest profitability by a corporate in Sri Lanka in just a span of 40 years, LOLC Group proves that a local Company with a big heart and bigger ambitions with strong leadership, drive and agility can create a global footprint and achieve market leadership in the new territories, creating brand equity for the island-nation. The profitability levels achieved by LOLC in 2020/21 could be the historical pivot point for a new dawn in corporate sector performance for Sri Lanka. Amidst a global trend of economic uncertainty, the Group’s strategic investments and robust financial performance have infused formidable stability and resilience to Sri Lanka’s economy.

Port City Colombo secures LOLC’s and CHEC’s Investment; sets the stage for the One Billion Dollar “Colombo International Financial Centre”

Browns Investments PLC, the Strategic Investment Arm of the LOLC Group, has entered into a landmark Agreement to partner with China Harbour Engineering Company Limited to commence the Colombo International Finance Centre Mixed Development Project in the Port City Colombo. China and Sri Lanka have long established an enduring relationship characterised by economic cooperation and societal collaboration, so this partnership further underlines the confidence and commitment to development in the country through the combination of a world-renowned Sri Lankan conglomerate and a distinguished Chinese enterprise.

This is a milestone project with an investment value totalling USD 1 Bn, representing important long- term implications on the economic growth of Sri Lanka, and has been accordingly declared a Strategic Development Project under the Strategic Development Projects Act No. 14 of 2008. With two companies at the helm with substantial international expertise as well as a strong commitment towards social responsibility, it is certain that this project will drive long-term sustainable development.

Port City Colombo (PCC), a vision to build a World Class City and to be the financial and modern services hub for South Asia was spearheaded by the then-President and current Prime Minister of Sri Lanka His Excellency Mahinda Rajapaksa and was jointly inaugurated together with the Chinese President His Excellency Xi Jinping in 2014. The reclamation of 269 hectares of land from the Indian Ocean was completed in January 2019 and was declared part of Sri Lanka in July 2019 after complying with all necessary formalities including a Parliament resolution. Infrastructure development covering internal road network, water channel, utility connectivity, 2 km long public beach front and a 14-hectare large Central Park is currently in full-swing and on schedule for completion in 2021 where the PCC is well set to be the leading retail, residential and business destination in South Asia. Built as an extension of the existing Colombo Central Business District, the PCC had an initial investment of USD 1.4 Bn and an expected overall investment of USD 15 Bn when completed. There will be 5 different precincts in the completed Mixed Development scheme, namely the Financial District, Central Park Living, Island Living, The Marina and the International Island. With an estimated 5.7 Mn square metres of Built-Up Area, the PCC will boast some of the best in design, in terms of offices, medical facilities, educational facilities, Integrated Resort, Marina, Retail Destinations, Hotels and various Lifestyle Developments. Using the latest sustainable city designs and smart city concepts, PCC will be at the cutting-edge of global standards and is anticipated to be a focal point of South Asia.

The inaugural vertical development of Port City Colombo (PCC) is to be a mixed-use development which will be the Colombo International Finance Centre (CIFC), divided into two Phases of implementation. Phase One comprises the construction of residential, commercial and retail asset components set to break ground in mid-2021. Phase Two will be a commercially-oriented development with office and retail space offerings that will commence construction parallel to the start of Phase One. Located in the gateway of PCC on a total land extending across 6.8 Ha, the CIFC project will have unparalleled views of the Indian Ocean along the South-Western side of the development. Further to this, there will be breath-taking views of the Colombo Port and Financial District, particularly on the East where Grade-A offices, banks, Five-Star hotels, luxury shopping malls and tourist refreshment areas and attractions are scattered within a 500-metre-radius. CIFC is expected to attract locals, expatriates and foreigners while boasting the lifestyle and business facilities comparative to that of other renowned business hubs in the region, as well as on a global level. The CIFC Mixed Development Project is set to be positioned in the fast-developing South Asia region as a locally relevant but internationally appealing composite development. Both the Port City and its CIFC Project are sure to be facilitators in promoting FDIs to Sri Lanka.

Message from the Prime Minister’s Office

The first investment within the Port City Colombo will commence with the one billion dollar Colombo International Finance Centre (CIFC) Mixed Development Project.

The momentous agreement between Browns Investments, the strategic investment arm of the LOLC Group, and China Harbour Engineering Company Limited (CHEC) was signed this morning in the presence of Prime Minister Mahinda Rajapaksa and Ambassador of China to Sri Lanka Qi Zhenhong.

“Attracting foreign direct investment is a key priority for our Government, and this landmark project is a strong indicator that Sri Lanka is now back in business,” Prime Minister Rajapaksa said. “We invite investors from around the world to explore the multitude of investment opportunities that Sri Lanka presents with its strategic location and human resource capabilities.”

The Port City Colombo was the brainchild of Prime Minister Rajapaksa, launched during his presidency together with Chinese President Xi Jinping during his state visit to Sri Lanka in 2014. With an initial investment of US$ 1.4 billion and an expected overall investment of US$ 15 billion when completed, the Port City is set to be the leading business, retail, residential and tourist destination in South Asia.

The project comprises a total land area of 6.8 hectares, implemented under two phases. The first phase of the CIFC Mixed Development Project, with an investment of US$ 450 million and comprising a land area of 3.06 hectares, will consist of the incorporation of a Special Purpose Vehicle (SPV) company, will be jointly managed by Browns Investments and CHEC.

The overall project, which will be implemented in a sustainable and socially-responsible manner, expects to create significant quality employment opportunities across a variety of sectors.

Message from the Embassy of China

China and Sri Lanka enjoy a history of friendship and cooperation for thousands of years. It’s a great joy to see that in the new era both Sri Lanka Government and Chinese enterprise are jointly developing many mega-projects such as the Port City Colombo and welcoming partners from all around the world to build the Colombo International Financial Centre Mixed Development Project together. At this crucial moment, China once again demonstrates its confidence in Sri Lanka and commitment to help Sri Lanka's economic and social development. It’s well believed that the International Financial Centre Project will not only effectively boost the vigorous growth of Sri Lanka's finance and other industries, but also create more high-quality job opportunities, benefiting the general public and society.

Statement from LOLC Holdings PLC Group

The CIFC Mixed Development Project will be piloted over two phases, whereby Browns Investments is partnering with CHEC for Phase One via the incorporation of a Special Purpose Vehicle (SPV) company, a subsidiary of Browns Investments. The total investment in Phase One amounts to USD 450 Mn with a buildable land area spanning 3.06 hectares, which is leased from CHEC Port City Colombo (Private) Limited to the new SPV that will be jointly managed by Brpwms and CHEC. This will be a significant undertaking involving the construction of one residential apartment tower, one serviced apartment tower, one office tower and a retail podium on the ground floor. Ascending to 39 floors, the total Gross Floor Area across the investments will exceed 160,000 square metres, with residential and serviced apartments encompassing an area of over 88,000 square metres inclusive of parking, a retail space of 24,000 square metres, while the office complex will have a cross area of over 48,000 square metres. Commenting on the CIFC project, Chairman of BI and Deputy Chairman of LOLC Group, Mr. Ishara Nanayakkara stated “we are pleased to partner with CHEC on this landmark venture that optimises the true potential of Sri Lanka’s strategic location within South Asia and consider it as a privilege to be a partner in the establishment of CIFC as a unique, multifaceted project in the heart of the Central Business District of Colombo. This project is well set to establish the Colombo International Finance Centre as a premier regional hub that attracts world-class players to employ a catalytic role in Sri Lanka, encompassing multi-dimensional value creation for the entire country.”

Statement from CHEC

As a responsible and reputed international company, CHEC has been committed to improving Sri Lanka's livelihood by developing its infrastructure nationwide over the last two decades. Fulfilling our social responsibility by creating tens of thousands of local employment opportunities and driving the development of a large number of local businesses. Today marks a new beginning, while cooperating with Browns Investments PLC (the strategic investment arm of the LOLC Group), CHEC has the absolute confidence to successfully develop the Colombo International Financial Centre Mixed-Use Development Project. The project will become a new centre for international finance, offshore business, trade and logistics, IT, tourism and shopping, creating a novel international and smart life style, establishing a unique landmark for Colombo and Sri Lanka.






Jiang Houliang, Managing Director of CPCC and Ishara Nanayakkara, Executive Chairman of Browns Investments exchanging the agreement in the presence of Prime Minister Mahinda Rajapaksa.
Standing from L-R: Thulci Aluwihare, Head of Strategy Business Development of CPCC, Sun Wenbin, Director of Property Development of CPCC, Li Guangjun, Counsellor of Economic Commercial of the Embassy of Peoples Republic of China to Sri Lanka, Qi Zhenhong, Ambassador of the Peoples Republic of China to the Democratic Socialist Republic of Sri Lanka, Ajith Nivard Cabraal, State Minister of Money Capital Market and State Enterprise Reforms, Kapila Jayawardena, LOLC Group Managing Director/CEO and Kamantha Amarasekara, Director, Browns Investments.



Browns Investments Becomes Largest Shareholder of Hatton National Bank



Ishara Nanayakkara-controlled Browns Investments PLC (BIL) has raced in quick time to become the single largest shareholder at the second-largest private sector bank HNB (Hatton National Bank).

Yesterday BIL picked up bulk of the 8.47 million HNB shares (at Rs. 130 each) generating a turnover of Rs. 1.1 billion. The stock closed at Rs. 128.25, down by Rs. 1.50 whilst it hit an intra-day high of Rs. 130.75.

Daily FT learns BIL now holds 9.9% voting stake in HNB and ranks as the single largest shareholder, though Sri Lanka Insurance Corporation via two funds owns 13.35%, whilst business tycoon Harry Jayawardena via Milford Exports (Ceylon) Ltd., Stassen Exports Ltd. and Distilleries Company controls 17.83%, and Employers Provident Fund owns 9.75%.

Deals on HNB accounted for 36.5% of the day's turnover yesterday. Separately Browns Investments saw 139 million of its shares traded for Rs. 917 million or 30% of the turnover. Collectively the duo accounted for 67% of turnover on a day when the Colombo Bourse remained bearish with indices down 1%.

The acquisition of the 9.9% stake in a month at an estimated cost of Rs. 5 billion also marks the return of Browns Group to HNB, which it founded in the late 1880s and incorporated as a limited liability in 1970.

Yesterday’s seller is believed to be Norges Bank, which as at 31 December 2020 held 19.37 million shares or 4.72%. Foreign holdings in DFCC Bank decreased by 6,134,698 shares yesterday according to NDB Equities. Overall foreign holding at HNB is 75 million voting shares or 18% of the total voting shares. Early this year foreign holding amounted to over 91 million shares or 22%.

Unnoticed by most analysts, BIL has been collecting available HNB shares from April. HNB has seen selling mostly by foreigners. Between the last week of March and end April or last week, HNB has seen net foreign selling of Rs. 1 billion amounting to 8 million shares.

A spokesman for BIL said the acquisition of an HNB stake was an investment on value. “We saw good value and the stake is purely an investment,” he added.

Market saw the re-entry of Browns Group to HNB as strategic though the spokesman dismissed speculation. Browns, and related party LOLC collectively, is also the largest private shareholder at Seylan Bank with over 23% stake (Browns 13.8% and LOLC 9.36%).

The Browns acquisition also comes hot on the heels of the Central Bank in its 2020 Annual Report released on Friday renewing its call for consolidation within the banking sector, to address existing weaknesses and boost resilience, although the sector saw higher growth in assets, deposits and profits in 2020.

In its 2020 Annual Report, the monetary authority said, with respect to enhancing lending capacities of financial institutions in the context of envisaged high economic growth and the low interest rate environment, the possibilities of financial sector consolidation should be actively pursued.

“Such consolidation would enhance the resilience of the domestic financial sector, while also addressing the existing weaknesses in the sector through the creation of a large capital base, enhancing its potential to finance large-scale transactions and attract foreign investment, widening the range of financial services, and thereby improving the efficiency and profitability of the overall financial sector in the economy,” the Central Bank said.

It added that most importantly, stronger balance sheets of financial institutions would enable improved credit flows to needy and productive sectors, while increasing capacity to service the growing financing needs of the economy.

By end 2020, the banking sector comprised 30 banks – 24 Licenced Commercial Banks (LCBs), including 11 branches of foreign banks, and six Licensed Specialised Banks (LSBs).

The banking sector asset base increased by Rs. 2.1 trillion during the year, surpassing Rs. 14.6 trillion by end December 2020, recording a year-on-year growth of 17.1% compared to that of 6.2% reported as at end 2019.

The sector’s profit before corporate tax was Rs. 190 billion in 2020, which was Rs. 17 billion higher than the previous year. Profit after tax of the banking industry rose by 21.7% to Rs. 136 billion during 2020 due to changes in tax policies commencing from year of assessment 2020/21.

Brown and Company owns 46% stake in BIL whilst related parties hold few more stakes. LOLC owns nearly 70% stake in Brown and Ishara holds 80% stake in LOLC.



Ishara Nanayakkara