The Central Bank didn’t want to manage Seylan and instead asked the Bank of Ceylon (BoC) to nominate a new board of directors to oversee its management, a Central Bank official told The Sunday Times FT.
When asked why the regulator itself had not stepped in to manage Seylan in this crisis situation, he said, “We would have had to acquire it had we wanted to manage it. We clearly did not want to do this because we had a bad experience in the early 90’s with Mercantile Credit. We are not people who can run banks. So this was the best option.”
In response to a question as to why the regulator chose BoC, he said, “it is the biggest bank, it has the blessings of the state and so far there has not been any controversies with BoC.” He agreed that BoC will be privy to all Seylan sensitive information, but that could not be helped. “This was the best option.”